Hugo Alves: Navigating the Green Frontier

As the landscape of cannabis shifts and grows, we're thrilled to bring you an episode soaked in personal stories and industry insights with none other than Hugo Alves, the advocate, CEO and Top 100 Who's Who of HighTimes magazine. From Hugo's formative years amidst Hamilton's steel city charm to practicing law  that have etched the path of cannabis legalization in Canada, this episode stitches together the fabric of personal growth with professional triumph. We traverse Hugo's intimate relationship with cannabis, balancing the pressures of a high-stakes legal career with the grounding presence it provides him—offering a candid look at how one plant can shape a life and a legal landscape.

Pull up a chair as we transition from the courtroom to the buzzing world of cannabis entrepreneurship. Hugo shares the electric moment of decision, swapping briefs for business plans, and the exhilarating leap into launching products that would soon catch the eye of High Times. The chatter doesn't stop there; we dissect the competitive dance between legal and illicit markets, discussing the delicate interplay of pricing and customer satisfaction that continues to shape the industry post-legalization. Each story Hugo unfurls is a thread in the larger tapestry of change and challenge, weaving his professional expertise with personal anecdotes of family and the art of staying present.

Rounding out our session, we zero in on the latest tremors shaking the market—from outdoor cultivation adventures to the pure live resin collaboration cartridge that's set to turn heads. Our spirited exploration of product development doesn't shy away from the hurdles of regulations, as we share our strides in adapting and excelling within this dynamic space. And don't miss the buzz around our sheesh beverage, the latest craze promising refreshment and relaxation. Each revelation of our chat with Hugo not only spotlights the ever-evolving world of cannabis but also serves as a reminder of the power of innovation and the importance of staying true to one's roots and craft.

Transcript

Speaker 2: 0:00

Minus 10, 9, 8, 7, 6, 8 inches, start 4, 3, 2, 1. I'm Sean and I'm Charlie and this is higher orbit. You're gonna hit us with the woo Woo. Good morning everybody. He needs another coffee. We're back. Wow, it's been a minute. Happy holidays, happy new year, everybody. We got an amazing guest in the house today. Been a very special friend of ours and a supporter of the Cosmic Charlie's brand and higher orbit for some time now actually. Yeah, we can list off, I mean, the several brands and companies that he's been a part of and helped guide. It's always like just to name a few. I'm wearing this shirt, the sick cozy ass sweater. He brought me back 40, pretty much the top of the vape game. You got Colab Project. You got Doze. Can you got? What am I forgetting here? I know I'm forgetting a brand. Definitely Tons Tons 4A.

Speaker 1: 1:05

Yeah, there's too many to name.

Speaker 2: 1:06

Other companies, but we got our boy, hugo Alves, in the house. Welcome.

Speaker 1: 1:10

Thank you. Thank you, thanks for having me. Glad to be here. Welcome to the plant.

Speaker 2: 1:14

Glad to be here, obviously that is if anyone doesn't know. We've been trying to make it happen for some time. I'm really glad you came on, man. Thanks so much for being here with us today.

Speaker 1: 1:21

Appreciate it, fellas.

Speaker 2: 1:23

That's impressive stuff. It's really impressive stuff. Man, where do you want to start? Where should we start History? Well, I'm just spotting here. I mean, I didn't know, you grew up in Ottawa.

Speaker 1: 1:34

No, no, no, no, no. Grew up in Hamilton, hamilton, I didn't know that. East end of Hamilton, okay, absolutely Big part of who I am 100%.

Speaker 2: 1:45

Damn man Been around, stayed in Ontario Again just kind of digesting some of this. So I mean we know you have a background, we've known you for some time, like you've been a huge supporter and friend of ours.

Speaker 1: 1:56

Well, we're next door neighbors, yeah exactly.

Speaker 2: 1:58

Yeah, for those who don't know, over at Cosmic Charlie's down in the Bellwoods area, hugo set up shop. How long has it?

Speaker 1: 2:05

been Day one, day one, I think, you know, for your audience that doesn't know Like around the cannabis weekdays, yeah. Since day one. That was our first office space ever. We've always been headquartered like 200 yards around the corner from you guys. You know we're representing the six for sure. Always been headquartered here, love the area.

Speaker 2: 2:28

Our local, your local shop, we'll say for most of the holiday, 100%.

Speaker 1: 2:32

This is my home base. Yeah, this is the home shop, for sure.

Speaker 2: 2:35

Always has been.

Speaker 1: 2:35

Day one since you guys opened.

Speaker 2: 2:37

Yeah, I can't state how much we really appreciate the partnership and kind of developing a relationship with you and it's always been so nice when you know you walk through the door. I'm like Hugo's here, I'm like we get to talk about all the fun stuff that's going on in the industry and it's been like quite a journey for Charlie and I as retailers and I'm sure for you as a licensed producer. Shit man, you're still around. It's been like many years Like where did when did you know you were going to get into cannabis and why did you get into this crazy shit?

Speaker 1: 3:06

Yeah, like. So, as I said, I grew up in the East End of Hamilton and my my journey in cannabis really started as a consumer, and you know it was ubiquitous. It was around us all the time and then I went high school high school, high school days, yeah, and then I, you know.

Speaker 2: 3:29

Do you remember the first time you smoked? I'm going to ask you. I don't think I've ever talked to you about it.

Speaker 1: 3:33

I do remember the first time I smoked. Yeah, it was nothing happened. I was like, hmm, I don't know why my friends, older brothers, all think this is the coolest and why my parents, like you know, think it's it's really evil, like nothing really happened. And then the second time is when something happened, but it was after I'd been drinking a bit, so like, what happened wasn't wasn't that great, but I don't know, call me determined. I kept with it and then discovered, and I think throughout my life it's been, it's been part of it and I think it's in many ways it's been kind of my secret weapon.

Speaker 1: 4:14

You know, as a, I think people of my age like you know we kind of grew up watching, whether it was in the media or in our own homes, like watching. You know our parents come home after a hard day and, you know, have a drink to unwind. Like my dad would come home. He was a welder like and he'd come home and have a beer every single day If it was a tough day, like you know, two beers. But so you kind of like you know you're, you're brought up in that hey, there's something to take the edge off.

Speaker 1: 4:42

But like, alcohol never really did it for me, right, like in my career path I've always worked really hard, had like in a high, you know, high demanding job and as you you get older and you guys are going through this now, right, with young families, like it's really really busy, work is demanding.

Speaker 1: 4:59

But then you also want to be present at home. And I found where a lot of my colleagues would have, you know, go and have a drink or do this, but it couldn't really disconnect, like I'd have a high demanding job where I was working till like midnight, one a one am in the morning, uh, mentally really stimulating, so it's hard to turn your mind off. And I found I can smoke half a joint, a joint, like like the minute I get out of here onto the street and like that I was disconnected and present with what I was doing. So I thought it allowed me to work really hard but then also have that mental break where, like I wasn't getting burnt out and also be really present with my family, be a good dad, be a good husband.

Speaker 2: 5:39

I totally agree. I find that like with my consumption to really like can give you that confidence you know, and and help you get a really good sleep, which I think is you know, a lot of people use it under. Underestimated. I know we're not supposed to talk about that in like a retail environment, but I mean anything that can help you get a better sleep and get a better start to your day and feel more well. Rested is good on my books, yeah.

Speaker 1: 5:59

That self-medicating part of it, right Like, is, uh, maybe growing up like wasn't the focus. It's always been fun, right, um, you know, brought us closer together as like friends with my, with my friends, but also, yeah, like I said, in my professional life, it was always not, it was always mixed in big in, but you'd have to keep it secret. Right, I wasn't showing up at my law firm going, oh yeah, I smoked it. Right, I got great sleep. I'm ready to go today.

Speaker 2: 6:27

Probably mostly frowned upon in general and, uh, I'm not seen, like you know what I mean and like the I guess, legal world.

Speaker 1: 6:34

Yeah, stigma has definitely evolved over the last 10 years, right, and that's been one of the, I think, the great boons, but also one of the great challenges like, ironically, of legalization is is the, you know, destigmatization, that sort of really changing social views towards cannabis use and, when it's appropriate, and you know what, what functions or what, what, what, what, what, what it can do for people. Right, and I'm we're driven like at Oxley and myself and our founders were, you know, we've always been firm believers that you know cannabis helps people live happier lives and that's really what we strive for. Our products are, you know, simple and uncomplicated. They're meant to have fun, um, and I think it's it's that belief that you know this is a, a substance that is net benefit to humanity, um, and and can help people live like, more present, more connected, happier lives. It really drives a lot of the, the passion that we have and and the way we think about products that we bring to market and how we position our brands.

Speaker 2: 7:39

Definitely, man. I think you kind of nailed it on the head there, and especially compared to, like a lot of the other I quote, unquote, sin kind of substances, I would say that cannabis kind of brings the most benefit to the table and you're talking about, I don't know Absolutely and we could argue about that a lot.

Speaker 2: 7:54

But of course I mean I think it's harm reduction, like when you made the comparison with alcohol, right, like there's. There's a huge difference there in terms of what it does for your health, your mental health, um, and how it's used, Uh, but just to dial it back. So I mean great story. Obviously, you know that passion's there. I've never really fully understood her craft because you've always had, you know, a lot of hands and things, um, but like going back to legalization, when Oxley came about, I don't even know what he actually like circa date, like what's going on with you?

Speaker 2: 8:24

go then, like you know, I know you were really integrated where you were doing and then laws changing Right, the law is changing, yes.

Speaker 1: 8:33

So, look, I went to, I went to UT law and I was there right when the seminal constitutional law cases were working their way through the court. Um and uh, I had a great constitutional law professor who was, uh, you know, he's like one of these kind of like wild rebel personalities. So he was, he was very interested in this and, of course, like I was very interested in it too, because I loved weed. Um, and then, you know, there was RV Parker in 2000,. Right, Really flip the script in terms of the way cannabis legalization was going to proceed in Canada, right that? I think that's. That's always one of the key differences.

Speaker 2: 9:13

Parker, sorry, I don't actually know.

Speaker 1: 9:16

I think it was a sort of appeal case in 2000 that held that, you know, restricting access to cannabis was unconstitutional, okay, okay, it violated your section seven, charter rights and, um, you know, that's important and can't look in the U? S right, the genesis of legalization is people wrote a bill, you know, mobilize the vote, got it onto the ballot and then voted into law in Canada. The genesis, totally different, right? So there's really really sick people who you know are at they've they've exhausted conventional medicine, cannabis, the only thing that helps them. So they have that right to their security of person, right. You have the right to try, and you know, protect your health. It's constitutionally enshrined. But you also have the right to, you know, security of person. You shouldn't be subject to prosecution. And by trying to pursue your charter right to, you know, to your healthcare. And the court found that that was in fact, you know, constitutionally invalid to put that restriction and told the government to go back and, as they do, pass a constitutionally compliant law. And they did that with the MMAR right, right. And so here I am.

Speaker 1: 10:35

I just graduated law school, I'm an Articling student, bright-eyed and bushy-tailed, on Bay Street, and you know, a lot of my high school friends are like, hey, man, we need legal now, like we gotta, can you help me fill out these forms? And I did and quickly realized like this is probably not gonna be like a legal practice for me, right, like I was like a student. So I went back to being a lawyer, right, and practicing on Bay Street and working with really smart people and high-end deals and really cut my teeth in terms of understanding how finance works, understanding how corporate transactions work and how regulation works. I've always been kind of regulatory focused in my practice areas. And then in 2013, you know, the government passed the MMPR right, which was really a fundamental shift, and I remember reading what were the mega differences?

Speaker 1: 11:39

The mega differences were like under the previous regime, you were regulating people, right, you were regulating the sick person. So you're going to get a diagnosis saying it's within this list of diagnosis is you go and get a second opinion, a confirmation of diagnosis, fill out a form and then the government's like you can buy weed. Originally it was you can only buy from us, right, which was the old prairie plant systems grow. So it didn't work out, you know it wasn't very good. And then the constitutional cases kept evolving to allow people to you know, let someone else grow for you, right, right, I remember this. And then, hey, I can't get cost efficiency with just one person. It's too prohibitive, I still don't have reasonable access. So hits that came along, like you know. Another case said okay, you can aggregate grows, you know, to make it more cost effective. So the constitutional landscape was changing, but a lot of it was still you're regulating people, right, and like sick people are shouldn't be the subject of the regulatory regime. So what this did is it changed the focus of regulation to production and distribution, right, and what I had saw from my previous experience of building a business in a regulated industry within the law firm is like, okay, well, this changes everything because you know companies are gonna have compliance obligations, they're gonna have regulatory things. So I thought this is great. This gives us an opportunity to actually, you know, have clients that you know a bit. Yeah, like a Bay Street law firm can help. Right, that has the like. They're the appropriate fit.

Speaker 1: 13:11

So, with a colleague of mine who's now the Oxley president, right, mike Lickford, you know one of the, you know, great, great partner in all of this and one of the, I think, real key, key figures for me in my professional career, even though he's, you know, technically, like you know we're mentor, mentee, but that's now we're, you know, we're just lifelong friends that run a business together. But I remember going to him and saying, you know, mike, we should, we should focus on this. Right, we had great practices. You know I was very active in tech and renewable energy and things like that, but we were very passionate about cannabis. So that's the driving.

Speaker 1: 13:55

You know, the driving force is that sort of I can mesh my personal and professional passions here and we just took the position hey, like no one knows more about this than we do, no one knows more about the regulatory landscape that we do. And, you know, we kind of looked at each other, we, you know, and we said, yeah, prove us wrong, right Like. And then we cracked the books right Like. We really put in the elbow grease. We worked like two jobs effectively for two years during the day we were doing our loss.

Speaker 1: 14:26

The firm thing right, like you know, meeting expectations. And then during the evening we were, you know, networking, talking to anyone who had an interest in the subject. We were writing articles, we were working with the you know conference providers. And you know, the key thing is we always had this notion that just because we're all, you know, we're these sort of like lawyers, like we have to invest our time right. So that was the very that was like.

Speaker 1: 14:57

The thing that really separated us from other advisors in the space is we were willing to give people time, we were willing to sit down, meet them, understand what they were going through and then try and help them. And that led to us acting for, like a lot of the early, early companies that at the beginning there were startups, they had no money, but then they became like the seminal companies in the space. Whether that was you know, the early pubcos, with you know, tweet that became canopy, et cetera. Whether that was with you know institutions, lyft, the various conferences. We played, you know, key roles right at the beginning of all of those companies.

Speaker 2: 15:37

Didn't you tell me that you had you helped co-found Lyft? Was that is that right? Did you tell me that? Or you helped, helped somehow bring it to fruition anyways.

Speaker 1: 15:46

Yeah, lyft was started by Tyler Sokachoff out of Vancouver, great entrepreneur, and early days it was more of a website. And then what really changed for Lyft is they said we want to do one of these kind of conference events and I remember back then it was like, you know, no one had resources and that first Lyft conference was really it was Tyler and then a guy named Alex Revich, who's still in the industry, right, still, you know he's had various roles, but Mike Lickford and then Mateo Oluru, who you know at the time was like a law student, but then eventually he really wanted to be in cannabis, and I remember the four of them like by themselves. How did you get involved? They called you or.

Speaker 1: 16:32

Well, I was, yeah, like I was, I was kind of the we were their lawyer. Go on it. Yeah, we were their lawyer, we were their startup lawyer. And then, and then Mike kind of like got co-opted into that foursome of of putting the the first Lyft conference together and you know that was really how it started and grew from there.

Speaker 2: 16:48

And that's such a big one. I'm curious cause you mentioned you know you were able to give time to all these companies and help start them off. When was it and you mentioned this to me before when you were like, why are we doing all this work for these guys? Like let's start our own fucking? Like it was actually always meant to be.

Speaker 1: 17:05

you know, you guys, you know it's not part of the plan. Yeah, Look, we started just going. You know we're lawyers, let's, let's be lawyers. It's something we love, right and, oh my God, like, what could be better, right, Like?

Speaker 2: 17:19

You gave me the network opportunity network with all these people too, right yeah we met.

Speaker 1: 17:23

We met great people. We had like all this great increased access to weed.

Speaker 1: 17:29

Like a lot of people couldn't like hey, we but they'd give us weed Like this is the greatest thing of all time. I'm always happy to accept weed samples, always, and no, it's over time. We acted for about 70% of all industry participants, so we acted for like almost everybody. And you know, look, it was like anything else. It was getting more competitive, more crowded. We were running into a lot of conflicts but we were also running into a lot of opportunity. We had a lot of a lot of clients and a lot of companies that weren't clients coming to us and saying, hey, have you ever thought of joining industry, joining a company? And we were working on a project with a client and it was different right, it was different than anything else that was out there and they really involved us both in terms of, like, our legal expertise, but really our industry expertise. And then they gave us an opportunity. They said, look like we'd really like you to join.

Speaker 1: 18:24

It was with Chuck. Rafichi was gonna be leading. I knew Chuck from early days, like he was an early client at Canopy. I met him at the ribbon cutting of the Tweed facility in Smith Falls and I remember Chuck saying, look, I'm thinking of doing this business, but I wanna do it if you do it. He offered me like obviously, great, great terms, like I could bring my team with me, et cetera, cause we're very team focused and, honestly, like it was really one of those moments in life where you sit back and go okay, I've got a great profile in the industry. This is like I love this industry more than like you know any other that I've worked in. I've got this great opportunity where I can go with my friends. If these aren't the conditions for me to take a risk, then what conditions have to exist, like what has to exist for me to like take a leap and leave this really like established?

Speaker 2: 19:24

career.

Speaker 1: 19:26

And I was like, if it's not these conditions, I'm dying at that desk and look like I love being a lawyer, like there was no problem, like I always loved what I did right, and I was a lawyer for 20 years. But I've always had an entrepreneurial streak I've always dreamed about. You know, I've always helped entrepreneurs as part of my business. I had opportunities to go into business before. I didn't take them, so I didn't want to. Like you know, you got to look at yourself in the mirror every morning. I didn't want to live with the regret, yeah. So I took the leap and you know what. It hasn't worked. You know the way we thought it was is common in life. But no regrets, I'm super happy I did it.

Speaker 2: 20:04

That actually takes me. I had a question I wanted to ask you Well we'll save it for the next segment I have another one too, but do you remember where your first product was? What was the first product you guys launched? That's a good, quick one, to leave it on quick one.

Speaker 1: 20:15

Oh, we launched a portfolio and it was. It was, but it was. Vapes and addables were the main products. Yeah, there we go.

Speaker 2: 20:21

Nice 2.0.

Speaker 1: 20:22

Yeah, still in the market, though, blackberry cream, mango hay strawberry ice, we'll be right back and don't forget sheesh is the official sponsor of higher orbit.

Speaker 2: 20:41

We're back. We've got Hugo Alves, Founder and CEO of Oxley Corp. High times top 100. When was that?

Speaker 1: 20:50

Yeah, let's talk about that one.

Speaker 2: 20:51

I don't know if that's really cool, like that's basically if your rocks are being on the cover, being a Rolling Stone, almost, you know.

Speaker 1: 20:58

Yeah it's, it's flattering. I think it's going from. It was one of those moments right when we all grew up reading high times and it was, you know, if you got yourself an issue of high times, it was cool. We go over to my friends, you know, or we gather in my friend's basement and you know the parents were, you know, would have an issue of high times. We, we, we read it. It was always. Yeah, it was like how we got.

Speaker 2: 21:23

I think you cracked the top 10. Am I wrong? I think you were number nine.

Speaker 1: 21:26

I think it's just the top 100. I know I put through the pages and you were.

Speaker 2: 21:32

you were farther back, yeah.

Speaker 1: 21:33

It was. It was a lovely piece of recognition and yeah, that is. It was great to see you know, go from reading the magazine as a youngster to be seeing your picture in it. Yeah, it was a great, great moment. That's what I was saying. My kids don't understand why it's so cool. They're like what are high times?

Speaker 2: 21:49

What is that? Yeah, yeah, but kids consume. Do you have a relationship with them in the plant?

Speaker 1: 21:54

Yeah, so yes, they, my oldest does, my youngest, you know, doesn't. But yeah, we, we, you know he probably will at some point. But yeah, we've always had an open conversation about it, right, Like they've always known what I've done. It's been important that you know my, my, my conversation with my parents, a very, you know, european right. Yeah, like this is drugs. Oh my God, my son the drugs.

Speaker 2: 22:26

It's a hard line, right. They're like it is drugs.

Speaker 1: 22:28

Yeah, but now it's different. You know, my mother, you know, passed away last year, unfortunately. But yeah, no, I appreciate it, but it was great before she passed away, right? And this sort of like elderly Portuguese woman who, like, grew up in that. You know, marijuana is drugs, but you know, I started. I got her to try an edible, no shit, yeah, yeah, half a half a foray salt to caramel square. She didn't even know and I, you know she didn't even know. But yeah, yeah, I just admitted dosing my mama All right.

Speaker 2: 23:03

Well, hey, let's. I would say that's a good. That's a good, friendly starter dose. What do you know what?

Speaker 1: 23:10

You said she was incredible time right, some of the best memories we have now of her in kind of that later stage in her life where she's going through health issues and you know life is a bigger challenge have been while she's been, you know, at our house for holidays and it's after dinner and we, like you know, gave her a half, a half a chocolate or and then she started taking them voluntarily, right, she knew what was going on. It's not like we dosed her beyond that, it was just to go. Hey, do you remember? Do you remember last night? Yeah, like I was cannabis, so I remember it was like Christmas Eve or something and she, we had a big dinner and then the half chocolate and then she started dancing with, like my son and you know she was having a great time and you know it didn't matter what I did at my house, like she would always complain about the sleep, right, she'd always oh, you know you could make noise to you, to get up too late or whatever She'd always get up super early and make noise and it would be like I know you're just doing this to get me up and woke up the next day and like there was no noise Like I woke up naturally and go downstairs and my mom comes up from her bedroom.

Speaker 1: 24:14

She's like just getting you back. Like oh, it's just slept so good. Like.

Speaker 2: 24:17

I don't know.

Speaker 1: 24:19

I was like, yeah, yeah, yeah, we got a new bed. It's called weed. Congratulations, You're full of cloud.

Speaker 2: 24:25

Maya.

Speaker 1: 24:25

Yeah. So you know I it really, yeah, it really helped, helped her tremendously. My dad also was like never even smoked a cigarette in his life. You know, I got to take him to to our cultivation facility, Got to see that he tried, tried smoking a joint with me. So it's, it's amazing just to see the change in attitudes and, you know, in their generation.

Speaker 2: 24:49

No, I think it's great when you can bond over cannabis. I think I've said this before, but the first time I ever consumed was with my mom, and it's something that I hold dear and close to my heart. I lied to her and told her that I had consumed before, and she's like okay, here you go. And I didn't know what to do. I didn't inhale and she's like are you sure you've done that before, because you're not actually inhaling it? And then she told me how to inhale and the rest is history. There you go.

Speaker 1: 25:10

So yeah, my daughter now comes into and she's like, do you have any more of those ice grape pre-rolls? You know, if she's over, you know over on the weekend, they're going to watch her move. I'm like, yeah it is.

Speaker 2: 25:24

It is a you know it is a it takes.

Speaker 1: 25:28

Yeah, it was a strange feeling at first.

Speaker 2: 25:29

The dad keeps asking you, you want the infused pre-rolls.

Speaker 1: 25:33

Sure, here you go.

Speaker 2: 25:35

Yeah, I think as long as you're having those healthy conversations. You said you're open and communicative. And I don't know. I'm a new parent, Charlie, soon to be, I guess I just announced it. There you go.

Speaker 1: 25:43

Yeah, congratulations, charlie, on the podcast.

Speaker 2: 25:46

Yeah, yeah, no, no, no, that's exciting news. We were chatting about something just before. Thank you both, of course. Just before we got to the segment and, obviously, having you shopped here for a while and you know, having those conversations, do you think, like, those 40, $50 jars are here to stay, like I feel like that's the thing that just came around during legalization and like in general. Like the flour, like buying weed. Yeah, the three and a half grand. You're a pretty hard price, cut off guy.

Speaker 1: 26:19

Yeah, look, I think that there's all sorts of different consumers, right, and I think that there are people that you know the high, really premium priced three and a half gram jar. I think that will be here to stay. You know, don't know what the volumes will change or not, as people look for, you know, find what they like and look for for, like larger formats or bigger value. But myself, my own consumption, you know habits, like I'm in here a lot, I talk to you guys a lot about what you're smoking and what you're seeing and yeah, there's a lot of great weed at the kind of top tier. I kind of like for my own purchasing thing, like I'm you know I've talked to you guys before like I look for one kind of like is the person who's selling it to me, the person that grew it, because I think you know, when you start inserting people into that value chain like now I'm, you know I'm not paying, like or the grow your.

Speaker 2: 27:16

I'm not paying.

Speaker 1: 27:18

Like you know, I'm not getting maximum value for that dollar right.

Speaker 2: 27:21

Someone's taking a little slice.

Speaker 1: 27:22

Yeah, there's like there's some like middle cuts along the way. So I do tend to look for, you know, the artisan that's put his, you know, put his or her, you know product in the bag and that's theirs. And so I will and I will pay a little bit more for that, for sure. And then I look for what's, what's happening in and around kind of the price points where we play right, who, who our competitors are, I think you know, whether it's back 40 or collab, I think we offer an excellent product, always had a great value, and you know we're trying to, we're trying to help people, you know, have fun, live a happier life right, and a lot of that is access, a lot of that's being able to access it. And you know, I think price does play a role in that. So I like to see, yeah, what's in it, around that value where I'm like this is, this is kind of where I'm okay, got it. You know, on a day to day basis with my kind of like spend and consumption.

Speaker 2: 28:22

I was thinking that collab, if I'm not wrong, I always thought of it as more of a premium brand, like when we first kind of got into it and I got to come back to Charlie's question. I've kind of noticed the prices of collab come down. Would you call it? It is premium but it's not anymore, I kind of. Would you kind of agree with that?

Speaker 1: 28:40

I think it's indicative of just the general trend towards increased value.

Speaker 1: 28:46

Yeah, it started off at a premium price point. Now I would say it's at like a core price point, right, accessible to everyone. And some of that is just driven by the fact that prices in the industry have come down. Like when we started our first products, like everyone referred to, like the cannabis tax, everything was like double right Because, you know, cannabis was supposed to be this big financial boon. So everyone, from, like your supplier to your service provider, would be like, well, you know there's additional risk, or the volumes are this, or you know you guys are gonna, you're gonna sell at a high price. So everything from packaging things were really expensive and inputs were expensive, right, whether you're buying live resin or whether you're, you know, buying cannabis. And so, as the prices have come down over time, it's allowed you to, you know, adjust your pricing to be more competitive with the illicit market.

Speaker 2: 29:38

Yep.

Speaker 1: 29:39

And make it more accessible to consumers right.

Speaker 2: 29:42

Definitely. I noticed in my research like you guys got a critical investment like right before 2.0. Did you see cannabis 2.0 as that opportunity to kind of like become the leaders in the spaces of that time?

Speaker 1: 29:55

Yeah, look again, I would say, like you know, one of the things that set us apart at the early days was we were regulatory experts, right, Like we really understood the regulations and where they were going and what the different classes of licenses could do and how to get them and how they would evolve over time. Right, Because it's important. And then when we looked at Oxley like our own kind of platform, we're like it's gonna be a long time before we've built our facilities and we're gonna get flour out of the door. And by that time we just felt, man, we're so behind, right, Like so many people in front of us, and we knew, like we just knew, this was before it had been announced, before there were regulations, before 2.0 was a word Got it.

Speaker 1: 30:44

But we knew that if the public health and safety objectives of the Cannabis Act were gonna be achieved as a fundamental you know and it's a fundamental ideological point I think we're still fighting on then we have to be competitive with the illicit market, right, and like, I think, at a very base fundamental level, common sense is you have to offer similar products, right, or else you're just not gonna compete right, If there are products widely available that are popular in the illicit market. You can offer them in the legal market. Guess what Consumers are gonna go to the illicit market, especially in today's environment, where it's easier than ever and there's like less focus on enforcement than ever. Stigma is gone right.

Speaker 2: 31:28

What do you think needs to change? I'm gonna ask you that because I do think that there's just like I know in Toronto it's a bigger issue with illicit stores just opening like crazy, but I think in general it's still here from a lot of people. It's not being enforced. It's a great time to be an illicit operator. Yeah yeah, I mean yeah.

Speaker 1: 31:45

Wow, for sure.

Speaker 2: 31:46

Look, it's what needs to change. I guess is all I'm saying. What do you think needs to change from your you know? Do you need to enforce it? Do you enforce the laws that are there? Do you enforce it? Does the law need to change?

Speaker 1: 31:54

Well, look, I think you know what legalization's done is. It's taken a lot of the stigma away in cannabis use, right Like now if you see like a 19-year-old or whatever, like a person walking down the street with a joint, not worried about getting busted?

Speaker 2: 32:08

Yeah, not worried about getting busted.

Speaker 1: 32:09

And what it's done is it's really shifted law enforcement priorities to other priorities, right, like they've got a lot of competing priorities, and then the excise taxation that's been collected, right, like one point one and a quarter billion dollars in 2023. Wow, that money hasn't been allocated to law enforcement, right, exactly, so it's kind of there going look, I don't have the resources, right, like a lot of officers, like you know, it's hard to tell. Illicit and legal market products is apart, and they've got fentanyl, they've got, you know, other healthcare, other law enforcement priorities. So they kind of go. Unless it's a real problem or something bad happens, like you know, they don't enforce. I don't think enforcement is really, you know, probably the catalyst. They have to have a vibrant, diverse legal market that can compete with the illicit market. You know, I think one of the big. It is a big challenge and one of the impediments is, like the data on the illicit market sucks.

Speaker 1: 33:15

Of course it's a joke, right, right, let me see. We got a stats can so they piggyback to stats can household spending, right, right, survey. So you got the federal government going. I'm talking to consumers about something where you spend your household money. I'm going to throw a couple like cannabis questions in there and ask consumers federal government asking you do you buy from like legal sources or do you break the law? Yeah, and then, oh well, 60 or whatever percent said said that they don't only buy from legal sources. So we've got this black market beat. This is like a survey of 2,300 respondents. Right, and it's kind of used as a shield in some instances. Right, like everyone knows what's happening in the illicit market in edibles. Right, like high THC.

Speaker 2: 34:04

Cheap price.

Speaker 1: 34:05

Cheap prices Maybe not actually Harder to youth, definitely Right In their marketing. And then everyone knows what happened when we had the edible extracts category, right, like that these people took like an innovative approach. Right, ogi and other companies took an innovative approach, then I guess some Six million months, six million dollars per month in additional consumer demand for those products, right? Wow, like that is how much incremental demand. And then, when those products came off the market, Disappeared.

Speaker 1: 34:34

That six million didn't go into regular edibles or back into flour. It just disappeared. Where did it go? I wonder where to go. People are not legally available anymore. I guess I won't buy them. No, I went back to the illicit market. But yet, you know, when you talk to public health stakeholders, who are very concerned, right, like they don't want artificial demand being created, they don't want appealing to youth, they're very concerned about the Potential impact of like high dosage edibles in like a minor right, like you know, toddler gets ahold of it and they will point to that data on. Well, you know, because we'll say, hey, we need to offer the same products as the illicit market to compete with the illicit market. These products are already there. They're dangerous, they're untested, they're high THC. Yeah, you know, they're targeted at youth. You need us to offer these products To pull that demand out of the illicit market and help protect public health and safety and help bring more sales to us as retailers too.

Speaker 1: 35:29

Yeah, listen of course, to help support the legal industry, because you need a healthy and In vibrant legal industry to compete right. Like you wouldn't send a flyweight Mount, like you know, hasn't trained in a couple years to fight like Mike Tyson in the ring right. Like, just not so yeah, you need a credible challenger or else it's not gonna work. But because you don't have this great data on the illicit market and what's really going on, it becomes like a data point. Yeah, it's a shield. Oh yeah, you know what?

Speaker 2: 35:58

I don't know what you're talking about doesn't know about that.

Speaker 1: 36:00

Yeah, we've already beat the illicit market and you know we don't need to put Canadians at risk for to get those last few consumers that are still going to the illicit market.

Speaker 2: 36:09

Yeah, you know I got a question for you guys. No, I'm just because we've come such a long way. Like you think about all the products, a vibrant market, like we have a pretty vibrant market, I would argue. We're increasing to 150 stores for operator, not great for, maybe, independence.

Speaker 2: 36:24

You know, it is what it is but it's still gonna help, is what it is right. You talk about economically Attrition, but do you think there's some degree of like romanticizing, like the illicit market versus the legal market, like even we still talk about it and sometimes you still get Billy fire weed on the black market?

Speaker 2: 36:39

and some people will never believe in the legal market or that joke. I don't know if you guys saw that joke recently where it's like he's like I would really go to a dispensary that catered towards those illicit market experiences, you know. Like instead of like an Apple store. Just a guy on a couch. He said, and I kind of feel like that's true, right.

Speaker 1: 36:57

Yeah, look, I think I Think that's one of the one of the big challenges in our industry and I think it, you know, ties into that point is our ability to communicate with our consumer. Hmm, right, and yeah, you go into a good illicit market dispensary, right, you know, you can just see the product.

Speaker 1: 37:17

You guys can talk about the product you like, you know you're talking claims, your you say whatever you want whatever you want, you know, you can smell it and buy with your nose, you can buy with your eyes and that creates, I think, like a more, a richer retail experience where, like there's less disappointment, you know what you're buying, right, you've seen it, you've smelled it.

Speaker 2: 37:38

Here we got.

Speaker 1: 37:39

We got, like you know mylar bags you can't see through. They all look the same, except maybe a different color Can't say much to your consumer, which leads to Consumers basically making decisions based on price and potency for the most part. So, yeah, it's difficult, right, it's difficult. You don't. You don't. You don't get the same Kind of nuance in that experience and that. But also I think that's one of the key Opportunities that you guys have done so well here in Charlie's is bringing that richness, you know, and that nuance to your experience. Right, like one of the great things about coming in here is talking to you guys, about you know what products you're seeing and what you're smoking and you know what you're hearing. Bringing that kind of like very Personalized customer service is, yeah, one of the the sort of key differentiators. I think that's that you guys apart.

Speaker 1: 38:29

Thanks, you go Lots of lots of good recommendations, including C. She showed it here. So there you go. That the champions.

Speaker 2: 38:37

I was like not sure I was gonna crack one, but I'm gonna do it, you know 12 somewhere, it doesn't really matter.

Speaker 2: 38:45

Yeah, no, yeah, it's just. It's funny. I always think about kind of the illicit market and just certain people's opinions and even, obviously, sean, having done it before and, like you know, we do delivery now and I just like remember the old days. It's like I'm getting a delivery, I'm waiting on this guy one hour, two hours. Yeah, where are you, dude? I'm on my way. He's like three hours go by now it's like 15 minutes.

Speaker 1: 39:06

Yeah, I'm calling you.

Speaker 2: 39:07

They're calling you always my weed, I left you with dollar tip.

Speaker 1: 39:13

Yeah, how easy people forget. Right, that's not an app on your phone.

Speaker 2: 39:16

Why? Why are we so like? We're fixated on the black market. I mean, I don't know, to some degree I think we'll get there.

Speaker 1: 39:24

I think so. I think we will for sure. Yeah, you know slow and steady.

Speaker 2: 39:28

Yeah, I'm gonna let you marinate on this one before I come back. What's the the biggest Um Thing you'd like to see change in our industry, whether it be that able limit? Can you see the weed Hugo? What do you think is gonna push it forward?

Speaker 1: 39:40

I guess yeah no problem, that's an easel.

Speaker 2: 39:43

We're back. We'll be right back with Hugo moxley. Welcome back back at the shop. Yeah, we got open soon. I don't open soon. One more segment with a good friend, hugo from oxy oxy. Welcome back, hugo, thanks. I asked you. Yeah, what do you want to see change man taxes? I should have known that was gonna be your answer. Yeah, for sure. Look like. I don't think Like the taxation and fee regime in our industry is ridiculous and I think even you know CRA finance recognize it.

Speaker 1: 40:24

But yeah, it's hard to give up one, one and a quarter billion bucks a year, but I think like there is nothing that makes a bigger impact Industry-wide right in terms of the survivability of the legal industry, in terms of the diversity Of the legal industry, in terms of the diversity of the legal industry.

Speaker 2: 40:44

And when you think about it too, I always say that our industry really was like born during the pandemic I mean 2018, sure, but like things really started to flourish around 2020 and so we already had to go through that as, like you know, a young industry still trying to find its Kind of place, and I think that, uh, it's time to give some back to Hugo. That's all I'm trying to say.

Speaker 1: 41:03

Yeah, listen, we, we, like I said, you can't the. We have decades of evidence To say that command and control policies do not work For harm reduction. In in, you know, drugs, you know. So the illicit market's going to win that fight every single time. So if, if you really do want to accomplish the public health and safety objectives of the cannabis act, if you want to keep kids safe, change the tax. Yeah, if you want, if you want, if you want to diminish the illicit market, you need a vibrant, diverse challenger. You need someone, the government needs a partner, to go in and and provide a credible challenger. And with the turds, current taxation levels, like, forget it Right, like you've got to offer the same products, yeah, or similar products. So you know being blind to what's happening in the illicit market and not allowing those products in the illegal market, in the legal market. Is a, is a, is a is a huge mistake in my estimation. And then ignorance is not listed.

Speaker 1: 42:09

You've got to be price competitive right and you know, think I think price is now we've talked about it, they're pretty equivalent. But you know what like after you take off the 30 to 40 percent off the top of your, your gross revenue, not your, your net revenue, your gross revenue and excise tax. And then you know Regulatory fees, another two point three percent plus your provincial markup, your retailer markup, like they'd be way more accessible.

Speaker 1: 42:35

Yeah, those are not costs that the illicit market bears. So look you know, we're regulated industry. We have to bear some compliance and regulatory costs and taxation etc.

Speaker 2: 42:45

I agree with all of that but it has to be rational in the context of the market and right now it's not right now it's not and we know like where all that you said, what 1.3 roughly billion, where all that tax goes, like this. Some come back, we have no idea. Yeah, it's all a wazzy woozy.

Speaker 1: 43:02

I know where it goes. It goes into general treasury, right. So pre legalization, I think there were a lot of, if you remember, there were a lot of, I think, government statements about where that Capital would go right to supporting public health and safety, to doing more research, to providing law enforcement better tools, to, you know, understand the legal market and and to providing public awareness about you know why it. You know legal market product is safer. You know what are the advantages of being in the legal market, providing that public education. And you saw a little bit at the the, the forefront. But look, we're in a inflationary, high interest rate environment. The government has a lot of Spending priorities and unfortunately, like you know, the capital hasn't been allocated there, even though we're?

Speaker 2: 43:55

we're low on the totem pole.

Speaker 1: 43:56

Well, even unfortunately, yeah, even like the.

Speaker 2: 43:58

OCS. As a don't forget, I'm gonna give you this before I forget you go. We grew our soil, the oil project where we actually are washing our plants. Oh cool. I legally grew this. Four plants is my first indoor grow. Let me know what you think. It's some. Some willies wonder. It's a very old genetic. You can keep that with you, thank you.

Speaker 1: 44:16

Thank you, smells delicious and it looks beautifully trimmed. Yeah someone put in the work here. I appreciate that. Thank you very much, fellas Of course man Just wanted to.

Speaker 2: 44:24

I'll get you some of the hash once we have it too. I think we're expecting nine, ten grams a hash yield out of everything that we gave to our good friend Bam.

Speaker 1: 44:31

Really, how much for us.

Speaker 2: 44:33

I don't know, I can't. We'll find out.

Speaker 1: 44:34

I'll follow up on it.

Speaker 2: 44:35

I think he told us like that would be. You know, we didn't give him that much playing material.

Speaker 1: 44:39

So hey, man, any kind of it's precious when you grow it yourself. You know, and I, you, you understand all the effort that goes into it.

Speaker 2: 44:45

Yeah dude, it was a lot of work. I will say yeah, and I honestly think I could have done it better. And I'm now I'm motivated to do it better.

Speaker 1: 44:51

Yeah, I grow outdoor, outdoor plant for outdoor plants, every single summer. Oh wow, yeah, it's, it's.

Speaker 2: 44:58

You know it's, maybe you can turn yours in half if it. Yeah, I'm not super good outside weather.

Speaker 1: 45:05

I'm not super good at it because, like you know, I focus and I lose focus at the exact wrong time, right like harvest time. But yeah, I enjoy it it's. It's a great way to pass the time in the summer every day.

Speaker 2: 45:20

Right, I am wheat. I think the next thing we're growing is motor head, so it's a motor. Yeah, we got some clones. There are some clones this time. Last time we went straight from seeds. I'm hoping these genetics are a little stronger but we'll see.

Speaker 1: 45:33

We got a pure live resin Colab cart coming out. What, yeah, that's the kind of next one for for the heads, for sure you know. I think you've, you've, you've seen like we were first to market with, like Premium extract vapes, right like our live. Oh, who got?

Speaker 2: 45:50

our award for that. We gave you guys that award. We're. You guys won our space traveler award for the wedding pie cart. We had to give you kudos for having the first thank you, market a lot of people have come afterwards and but you know like, I'm just wondering who actually received it. Yeah, is that on?

Speaker 1: 46:05

your desk.

Speaker 2: 46:06

We gave it to him. Is it on your desk?

Speaker 1: 46:08

It's probably in Mike, like for something else. He's got the nice office collects the awards. But yeah, look, so we're. We were first to market with those. I think it was we brought those on market really kind of at the peak of the trend to, you know, fruit forward vapes, right, and the the price of those inputs was obviously very high, so the price of those carts had to be more elevated. And now we've seen this.

Speaker 1: 46:35

And then we saw the trend, like you know, in the US it was already a thing with refined resin, right, like you know, distillate, enhanced Premium extracts. I think that is the prevailing trend right now. It because you know you get this potency problem right, like if it's a pure live extract, it's, it can't meet those potency expectations that everyone looks at. But now we're starting to see the consumer trend come back, right, you know, to these sort of like more premium live extracts. And so you know we have refined resin type of products, but with the, you know, with the motor breath, it's gonna be just pure live resin, like unadulterated Let the, let the extract speak for itself. So looking forward to that one, you know that's doing yeah, for sure.

Speaker 2: 47:17

That's awesome, man. I know you guys are got a cherry. I was excited about your sour cherry vape too. I think that's yeah that one's.

Speaker 1: 47:23

That one's a delicious vape. That's under the back 40 line, so you know that's a little bit more fun. You know that's gonna be. Yeah, it's more in that sort of fruit kind of vape Thing. It's delicious. You know, I really like that one.

Speaker 2: 47:38

I think a strength to you guys with the vapes, and I've always said this is like your hardware is killer. You always pick great hardware. I think I've only ever dog one. That, dave, I remember we have one regular that I think. How many carts have I sold so like out of how many? What can one like? Definitely less than than any other brand I can think of anyway. So yeah, it was for that.

Speaker 1: 47:55

Yeah, look like you know our vision is really to be a global leader and quality cannabis products right, so we always focus on the quality of our product. Vapes is, I think, in vape hardware right. We just won the kind award this year for best vape hardware there you go speaking of we have.

Speaker 1: 48:13

You know we have an a plus rating with the OCS for our vape hardware, which is like the kind of lowest returns in the industry. Our co-lab cart is the highest quality cart in the industry, right like period like this is like all metal body glass. It's specifically tuned to our oil. You know high, high performance. Any extract I taste in that card always tastes better than any other cart, and we do. You know we test different hardware all the time and I think the you know the quality of our hardware is a real competitive Strength. I think there's lots of companies that are doing great things in vape. I continue to think we're one of the very best. We've had tons of first to mark. We were the first to market with a one gram vape cart. We were the first to market with like a fruit forward there. We were the first to market with a premium live extract only cart. Now we're the first to market with like a palm held all in one right.

Speaker 2: 49:05

So those were killing it by the Resing gummies to. I feel like that was first to market.

Speaker 1: 49:10

With resin, we're the first to market with an infuse pre-roll.

Speaker 2: 49:12

Yeah, turp sticks yeah.

Speaker 1: 49:16

We made the wrong bet on that one. We thought we could do like a better job than you know, and so we really worked on the input and I think part of that was we started that product before health Canada came out and said it's okay, you can mix classes of cannabis as long as you deem it an extract. Right, because, remember, under the rules said, like, you can't mix Classes, so it either has to be an extract or it's gonna be dried flower. So we actually messed around with our input for that and created like a more refined input product that we thought smoked better, was more enjoyable, but you know we couldn't get it to the super high potencies that eventually like ruled the day. So, like you know, we switched our formulation now to be able to Hit those consumer expectations in our infuse pre-rolls and we have some some cool products coming out on that front as well.

Speaker 2: 50:02

I love that man. Now, you guys are always listening and paying attention and I feel like it comes market leaders right yeah. Yeah, comes from the top you go. You're always paying attention and listening to what we love weed.

Speaker 1: 50:12

So, like you know, we're Looking for hey, what's, what's a great new product? What? What do we like to consume? Right, and I think that you know that really comes through in terms of, like, our product focus, like we're increasingly focused on vapes and dried flower and pre-rolls, and you guys know, right, like I'm that's the flower. I'm a flower guy, I know it's, it's maybe a little bit old school, so I think like I've always grown up like loving flower. But the convenience of a pre-roll is really.

Speaker 2: 50:46

People are getting farther away from flower and and getting more into those kinds of products we talked about that of those things that are just easier, I guess, for lack, convenience and it's the quality of those products too.

Speaker 1: 50:55

Right, like when pre-rolls first came out everyone's using, kind of like it was almost a way to use your, your sort of like leftover, your product. Now, you know, I look at our pre-rolls and we use nothing but whole flower. It's the exact flower goes in the bag. We don't adulterate it with anything like turps or distill it. Let the flower speak for itself. And, yeah, it's great. I mean the. You know I Still buy whole flower regularly when I want to roll like a bigger joint. But, like you know, we also got something coming out for that. It's probably the product I'm most excited about Coming out. You know, I firmly believe like this is my personal view that the best way to consume cannabis is in a straight-roll format, yeah, cone format. I think even with today's, especially with today's higher resin weed, right Like, by the time I get to the end of a cone, you'll get some cloning issues.

Speaker 1: 51:48

You know it's hard to get that like real good draw and like this is great weed and you kind of feel like man, I look like you just got to be a better way. So I think with the straight roll it offers you that. But you know, point three, five sometimes isn't, isn't enough for the occasion. So we have a bigger joint coming out in that format. It's probably the product I've been most excited for myself.

Speaker 1: 52:08

Cool consumption, the big straight roll yeah and yeah to be out in the. It'll be out in the launching in spring. Be in stores. Look forward to that. Just in time for you know, some are fun in your own back 40 that makes sense.

Speaker 2: 52:23

Thanks for dropping by today. Let's call the sheesh hotline quickly.

Speaker 1: 52:28

Yeah, look, you guys introduced me to the sheesh. Yeah, you like, I know they're a big part of what you do here. I think Amazing, I still buy it. You know, you guys introduced me to it. It's, it's one of my favorite beverages, so you know hats off. Hats off to them.

Speaker 2: 52:42

They're doing a great job show it to Matt and Jackie. Just hash it out. You might end up on our Instagram, isn't it? Beep? What happened to the beep? Please hold while we connect your call to Let me know what the hell happened there. All right? Show some, oh see you next, when you you.