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As a starting point, let’s talk about your background. What are you passionate about? How did you get started in the cannabis industry?
I’ve always had an interest in plant medicine, natural remedies, and alternative medicine – that whole category of products.

INTERVIEW

Harnessing the Power of “Precise Disruption” – 7 Questions with Austin Rhodus

December 8, 2022

Harnessing the Power of “Precise Disruption” – 7 Questions with Austin Rhodus
Harnessing the Power of “Precise Disruption” – 7 Questions with Austin Rhodus

As a starting point, let’s talk about your background. What are you passionate about? How did you get started in the cannabis industry?

I’ve always had an interest in plant medicine, natural remedies, and alternative medicine – that whole category of products. I was in the military from 2007 to 2012. I was stationed in Hawaii on a submarine. My military experience led me to have some issues with sleeping.

On a submarine, we work 18-hour schedules when we're on deployment. So instead of a 24-hour day, we basically get up, we stand watch for six hours, we work for six hours, and then go to sleep for six hours and then your day starts over. So, I had issues with my circadian rhythm keeping up with my sleep cycles and telling my body when to sleep.

When I was in Hawaii after the military, I began exploring different cannabis products, and discovering what was available on the market at the time. I couldn’t find exactly what I was looking for. THC itself wasn't really doing it for me. CBD by itself wasn't doing it. For me, CBD and melatonin was a good combination because the CBD would help with going to sleep and then the melatonin would help you stay asleep. This discovery led us to making our own products.

The original product that we created was a CBD and melatonin product. That was in early 2015. We mixed CBD and melatonin and suspended it in a syrup form. You could mix it with a beverage, or you could just take it kind of by the spoonful, similar to a cough syrup.

It started off with us giving it to a couple friends and family. People had great experiences. We suddenly had 80,000 people on Instagram in the course of 3 months and it just completely took off like wildfire. This was the very beginning of the mass adoption of CBD. So, the timing was perfect. Not including THC allowed us to distribute those products on a national level and also have a very competitive price point.

I'm really passionate about finding alternatives to pharmaceuticals. Plant medicine has been proven to work for thousands of years and that's really what got me into cannabis from a business perspective.

What advice do you have for cannabis entrepreneurs who are facing lean times like the industry is facing now? What strategies can business leaders consider to survive and grow?

The cannabis industry is full of hurdles still to this day. In small ways it has moved in the right direction over the past decade but there are always new hurdles to overcome. We had eight merchant accounts and ten banks over seven years when I was running that business. Facing obstacles requires passion and a mission behind what you're doing in order to continue doing it.

I think one of the biggest differentiators is building your business around consumers’ needs and actually solving a problem versus just sitting at a table and coming up with a product that you think someone might purchase. That means engaging with the community and getting feedback from customers and consumers of the products and figuring out how to address gaps in the market. Asking yourself, what do people really want and what do they want the outcome to be? In the CBD space, everybody sold CBD for a long time because they said, oh, there's CBD on the label, people will buy it. Well, CBD is just an ingredient and what people are looking for is a specific outcome. Building your products and your business model around the outcome that your customers are looking for, I think, is a very key aspect to running a successful cannabis business and business in general.

Your background is very diverse. I’m thinking specifically about your web3 expertise. Do you see opportunities in the convergence of cannabis and web3 tech?

Another passion of mine when it comes to business is, I enjoy disruption but disruption from a place of precision. Anybody can come in and disrupt industries and create something new and throw it out there in the market and it might do well. But coming from a place of precise disruption, looking at web3 specifically, there's a lot of opportunity for web3 interfaces related to regulations, compliance, certifications, tracking, logistics, and licensing. I think smart contracts can solve a lot of problems because of the enhanced transparency. Already some universities are issuing NFT “living” diplomas that deteriorate over time if you don't keep up with your continued education. Cannabis is a great use case for that approach and the industry is in a great position to leverage a lot of those benefits.

What made you decide to join the Chorus Compliance team?

I've been an owner and operator for a long time in the cannabis space, and I’ve also worked with a lot of different non-profits. I've seen firsthand how legislation changes a lot of things. What appealed to me about Chorus Compliance specifically, is that they’re not just a software company spinning up a product; they’re born out of SC Labs, which is one of the first testing labs in the nation. They saw a problem that was worth spending some time and effort to solve.

I think that the product is going to be useful and widely adopted because the tools take out many of the hurdles and headaches that interfere with operators’ day-to-day operations. This product can have an immediate and direct effect on their potential top line and bottom-line revenue. I know from the standpoint of owning a business that compliance hurdles can prevent you from expanding and growing your business. It’s the difference between being wrapped up in the day-to-day operations and just staying alive versus expanding.

From your perspective as someone who’s launched and managed cannabis businesses, why should business leaders care about compliance?

Well, for starters, they don't want to get shut down. We've operated in a space for a long time where states that have legalized cannabis haven't really had the time or the manpower to conduct the number of audits that the state probably desires to do.

What's happening and I think it's going to expand, as these state agencies are now getting up to speed on what everything looks like is that they're going to start deploying more human capital and resources into making sure that every single business that touches the plant is compliant from start to finish, top to bottom. There’s a lot of things that can happen in each step of the process from seed to shelf. The state governments and local jurisdictions now understand the industry better which is going to allow them to crack down on it more efficiently. I think that a lot of these cannabis companies that have existed for a long time haven't had to deal with the amount of regulatory oversight that is going to exist in the future. I think you're going to see more people getting shut down and you're going to see more people getting fines and fees that will affect their bottom line.

That’s going to be something that needs to be handled from a business perspective, figuring out the puzzle piece that keeps you compliant and fits into the day-to day-operation of the business, and Chorus Compliance fills that gap.

You’ve invested a lot of your time working for non-profits, specifically organizations that support farmers. How can the industry do a better job of supporting farmers, especially as we grow and become more commercialized?

I think there's two prongs to this, one of them being education. There's a lot of people that understand the plant very well and have a lot of expertise. A lot of those people that know how to do that are not necessarily farmers. They would probably fit more in the category of a grower, which means they know the plant very well, but they don't necessarily know how to farm on a mass scale or scale that grow operation. So, there’s a lack of understanding about what scale looks like. Eventually we're going to have federal legalization that allows us to cross state lines. What does that structure look like from a cultivation perspective? We may have large companies come in and invest billions of dollars into having central hubs across the United States and take over the mass production of the plant. It requires education for these farmers that have been struggling for a long time to take on large production operations and start to farm thousands of acres.

Secondly, and I've said this for a long time, what the farmers need more than anything is a very concrete logistics system so that farmers know what to grow, they know how to grow it, and they know what the future demand will be so they can structure and scale their business to supply consumption. That weight falls on the brands that are pushing the products and lobbying to have cannabis regulated so it can scale.

Speaking of cultivation, let’s talk about an event you have coming up soon. I understand you’ll be attending the Emerald Cup next week.

The Emerald Cup is a great example of the foundation that both SC labs and Chorus Compliance were built on. A lot of the leaders of SC Labs, Jeff Gray, Alec Dixon, Josh Wurzer are OG's of the industry and innovated many aspects of the way we evaluate cannabis through terpene profiles and chemotypes. SC Labs tests all of the samples that are submitted to win awards at the Emerald Cup. This year is even more significant because this is the first year they’re using a new classification system based on cannabis phytochemistry, developed by Napro Research, and correlated by the SC Labs data base of 250,000 terpene tests. I’ll be out there on behalf of Chorus, talking to people about what problems they’re facing and figuring out how we can help. I’m very excited.

To learn more about Chorus’s solutions, please visit https://www.chorus.cc, or contact us to schedule a free demo.


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