In this episode, we are featuring the story of Jay Hartenbach, a co-founding member of Medterra, who in his living room began this crazy journey. He has led Medterra to become the most widely distributed CBD company in the world.
With a background in biomedical engineering, Jay and his team developed the highest-quality CBD products for everyday consumers looking to experience the amazing effects of CBD.
Join us as he shares his story and the peaks and valleys for the road to success in this space.
It’s been a lot of quick growth and a lot of focus on still delivering that same customer experience, no matter how big we’ve been as a company. – Jay Hartenbach
Some Topics We Discussed Include
2:53 – From Biomedical engineering to the hemp and CBD space
4:48 – Major considerations in switching from being a supplier to having a retail store
08:55 – Advantages and disadvantages of using the internet as a primary launchpad
16:23 – The marketplace today versus two years ago
26:09 – Giving back to the community
33:28 – Advice for budding entrepreneurs and existing brands
38:54 – The future of CBD in the next 6-12 months
42:19 – Final words
People Mentioned / Resources
Connect with Jay Hartenbach
Connect with Sonia Gomez
Sonia Gomez: What’s up guys, Sonia Gomez coming to you from Denver, Colorado. Super excited to be here on another rock your socks episode of The Hemp Revolution Podcast where we are sharing and telling the real stories behind the scenes of the entrepreneurs and pioneers who are pushing this incredible industry forward. If you’re a person looking for products you can depend on you can check us out at medicalsecrets.com for some of our favorite picks.
And if you are a budding entrepreneur or established brand who’s trying to break through the brick walls and glass ceilings that this amazingly challenging industry has to put in front of you. Don’t worry, we are here to help check us out at theemeraldcircle.com for tips, tricks, tools and resources and even key relationships that you need to succeed in this space. You guys will never believe what we got up our sleeves today.
I hope you’re ready. Pullover your cars if you’re driving to work, no need to continue anything else except for listening to us because we have I mean some pretty incredible stuff for you today.
We are featuring the story of the co-founding member of Medterra who in his living room began this crazy journey. Jay has led Medterra to become the most widely distributed CBD company in the world with a background in biomedical engineering, Jay and the team have developed the highest quality CBD products for everyday consumers looking to experience the effects of CBD.
Needless to say, there are many peaks and valleys for the road to success and here to shine a little light on the process and to share his story about how to make it happen in this space. Can you please put your hands together and help me welcome our good friend, Mr. Jay Hartenbach. How are you doing, Jay?
Jay Hartenbach: Doing well, Sonia, thanks for having me on. That was quite the intro. I hope I can live up to it. But we’re certainly excited to be on.
Sonia Gomez: Hey, you know, another Monday morning for us. So around here, why don’t you do us the honors and, you know, intros they’re all good and well I’d love to hear straight from the horse’s mouth. Who are you? And how did you end up in the CBD space?
From Biomedical Engineering to the Hemp and CBD Space
Jay Hartenbach: Absolutely. So it all started a little over two and a half years ago, we had the opportunity to get involved in the space. My co-founder, JP Larson had been very familiar with the hemp industry and he was really focused on the cultivation side of things and had it both, I should say contacts in the US as well as internationally and with the 2014 Farm Bill passing, had this opportunity to one, actually domestically source, hemp and CBD and really work on a kind of supply-side relationship.
And when I got connected with JP who was an old college buddy of mine, just getting caught up with him and ask him what he had been doing. You know, it made me aware of obviously all the work that he was doing in the CBD in the hemp space. And I was obviously interested.
I was working this very corporate job at IBM. I had an interest in entrepreneurial pursuits and grad school I had started my own online skincare company just to see what could happen. And you know, I think that entrepreneurial bug had bitten me. So when I was talking to JP about this new and exciting industry, I was all in and I had done some research on CBD and saw that some of the early scientific research was very supportive.
And really, I think, kind of open-ended, you know, CBD in the early research was kind of showing that it could be a lot more than just one specific treatment or for help with one specific condition. And so, we partnered together and we started Medterra, we were only focused really on the wholesale side. So we were using JP’s relationships with his heart, his farming network in Kentucky to supply other CBD retailers and manufacturers with the raw products.
Major Considerations in Switching from Being a Supplier to Having a Retail Store
And as we had gotten that business off the ground, we were you know, very poorly funded because it was our money that got it off the ground. We saw an opportunity to be really disruptive specifically in the online space of selling our own retail product. And so using our farm that we had developed this relationship with, we were really able to provide the end consumers of true seed to sale product, where we knew exactly where the hemp was being cultivated, as well as obviously knowing how the product was formulated and manufactured and then selling it directly online to them.
And we also saw, I think, an opportunity to be somewhat disruptive in the customer experience side of things. And so we think about 2016 and 2017, how CBD was being sold, especially online. There wasn’t a lot of transparency, COAs we’re not necessarily something that was always on the website or provided to the consumer. If you call the customer service line more often than not, there wasn’t someone actually picking up the phone and answering it, especially for some of the smaller companies that were we’re kind of around in 2016-2017.
Sonia Gomez: No, it was like [inaudible] your cell phone.
Jay Hartenbach: Exactly. It was that Yeah, exactly. [inaudible] That’s right. Or a voicemail or, you know, one of the issues that we had saw was, you know, someone would place an order. And a lot of the people that were ordering CBD now and back then was for a specific thing that they didn’t necessarily want to wait for. Right? This wasn’t the type of product that if it showed up in two weeks, that’d be great.
And so we saw, you know, if we can use our relationship with the farm to lower the actual price to consumers because we don’t have any middlemen, we can be assured of the quality and consistency because we were the one sourcing it and then formulating it. And then finally, that customer experience side of things, which to your part, and Sonia, at some point, or for most of the time, in the beginning, it was me answering the phone.
But with that being said, it was something that we were committed to and making sure that we had that customer experience and we weren’t necessarily trying to get people off the phone. We were trying to educate them just about CBD in general because it still was really early on. And those three things combined into what we had and a very successful launch online.
So within the first six weeks, we sold into all 50 states. And we realized that ultimately, we wanted to own our own retail brand, as opposed to being a supplier for other retail brands. And that we could do it better, or at least we thought we could do it better. And from there, that turd grew.
And so, you know, shortly after starting an online business in my living room, we moved into an office, just down the road that had about 2000 square feet, and we put myself JP and then a couple other early employees, and we quickly outgrew that and about four months and had to break that lease and moved into another office and then about four months after that, we broke that lease. And we just moved into our final building of the building that we’re in now which is about a 40,000 square foot space in Irvine.
So it’s been a lot of quick growth and a lot of focus on still delivering that same customer experience, no matter how big we’ve been as a company.
Sonia Gomez: I love that. You know, I love that this is that I get to hear this story. You know, everyone sees your product everywhere, right? You’re all over the place. You’re online, you’re offline, you’re everywhere. And I am super excited to find out like the human story of this is like, just like everybody else who’s trying to get started now or in the last 18 months to now, or is even considering getting in now the landscape is changing three to five times faster than anyone would ever expect.
I mean, who would have thought that you would move in, let’s say, a 12 or 16 month period from 2000 to 40,000 square feet to accommodate staff, and you know, the growth of your business that’s huge quantum leaps, right? The landscape also for online advertising and talking with people who are in this industry, you know, maybe in their first 12 months, navigating the online space is a pretty significant challenge.
As far as marketing and distribution go. Do you think that your success and marketing online had to do with timing, or was it? Did you guys have some super ninjas on your team? What do you think made the difference for you leveraging the internet as a primary launchpad?
Advantages and Disadvantages of Using the Internet as a Primary Launchpad
Jay Hartenbach: Yeah, so I just did talk about launching online, I think that’s the best place for an entrepreneur to kind of build out a proof of concept, right? You know, you can be so much more nimble online. It’s a much lower startup cost.
It can be very competitive online, which is obviously the disadvantage, but for us, it was the perfect place to launch because we were still figuring out what products we wanted to bring the market. Timing absolutely was a part of it.
I think, if we launched Medterra today, I know we would still be successful because what we’re doing ultimately is the same thing that we were doing in 2017. But it would be different. And I think when you look at what we were doing in 2016, and 2017, it’s just about adapting your strategy as the market evolves.
And so I know a lot of CBD companies that are just starting. And so we’re having fantastic success because what they’re doing is finding something unique to offer consumers. That’s the advantage of being online is being able to see what the competitive landscape looks like, and finding something different.
The advantage of being online is being able to see what the competitive landscape looks like, and finding something different. - Jay Hartenbach Click To Tweet
For us, obviously having that timing, one of the things that we did, that was very different than everyone else. We because Google AdWords was not available, social media wasn’t available. We knew that there’s a lot of people still looking for education. They weren’t necessarily looking for a specific brand or product, but they were looking to understand Okay, I’ve heard so much about CBD. What is it?
So one of the first things that we did was we went to all of the top-ranking websites that had educational information about CBD, so someone was typing in what is CBD? What can CBD be used for? Is CBD illegal? All of those questions which were getting so much traffic, especially early on, we went to those websites and we locked up the advertising on those websites and our belief and it’s the same.
The belief that we have now is if we educate consumers just about what you should be asking about a potential company is it an efficacious amount of CBD? You know, do they have a COA that shows, you know, that they’re testing and contaminates all of those questions, we were confident that they would do that research and they would still come back to Medterra wasn’t like we were feeding our own competition. And so that’s what we did. We went to all the educational sites, and placed Medterra banners or instructor you know, further education, you know, maybe a blog post or something like that, where then the consumer could go from that initial search of what is CBD to, you know, how I can use CBD and then that would obviously lead to our products.
And I think that was really helpful for us as opposed to beating consumers over the head saying, best price CBD or, you know, CBD you can trust, right? It was allowing them to kind of have their own educational path and then when they were comfortable, then they would obviously recognize that mentor name because that was associated with a lot of the education sites. So I think that was really helpful.
The other thing that we did just because we were so limited was working with ambassadors to tell our story in their own words. I think that’s just a larger macro trend as far as anything digital goes, when you have your an ambassador or someone that is not necessarily employed by the company, telling their story or their experience with whatever product but specifically CBD, where there is a question of trust and authenticity, it is much more meaningful to consumers. So that’s where we really built out our ambassador program.
Working with people like Chris Burkard, Lucas Glover and The William’s brothers, who are these professional cyclists that are completely upending the cycling world. All of those people were using Medterra products before we even had reached out to them. And so when we eventually brought them on as true ambassadors of the company, their stories in the way that they portrayed themselves to potential consumers was so much more authentic and they were able to tell their story on their platform, which is, you know, could result in millions of impressions without necessarily having to run a paid search campaign. We’re running an Instagram campaign.
Sonia Gomez: Right, we’re doing something extremely similar because, you know, and I tend not to advocate for this as a strategy like I absolutely love that you are talking about the education, the time and attention that you put into that front end piece of just, you know, giving the information that is necessary to empower somebody who is looking to CBD or, or holistic remedies as a whole for a lifestyle shifted because it is very much a lifestyle shift. It’s a conscious decision that you have to make to utilize a remedy like CBD and the combination of other things that fortify your system in order to Achieve Wellness or balance.
I think homeostasis is somewhat of an abused word in our industry right now. Because to achieve real balance, you have to look at it from multiple aspects, right? So I love that you’re working with education.
That was a huge part of what we did in the very beginning as well. And then the ambassador play, holy cow, what a powerful. I go back to Kim Kardashian, who, it’s kind of a random thing, but Kim Kardashian could not have said it better when she said, I have built up a community focus group that quite literally at the push of a button, I can generate multiple seven figures in sales, or I can quite literally change a law or the revenue or valuation on a company. And that’s because I have my built-in network and I can be an ambassador for the things that I believe in.
The way I hear you using ambassadors like this, people who have real influence in a crowd is so super powerful. And for those of you guys who are listening and trying to figure out what the best way for you guys to come into the market, especially if you’re working on a limited budget. Getting that alignment with ambassadors who have, you know, the proper brand alignment for you is such a powerful tool, because again, somebody is telling their story and offering your product as a part of their stories solution. And it’s like the best of both worlds.
I’ve been able to do this, you know, generating multiple, five figures for our customers at the push of a button all through just telling my story and I won’t do it. If the product doesn’t work. That’s the most fascinating thing about your guys’ stuff is you’re truly seed-to-sale product, fully vertical.
And you have been since the very beginning, and I’m curious to hear your feedback on this. Today, we’re in a marketplace that’s quite a bit different. A lot of manufacturers have come on board, a lot of people are doing the white label programs, they’re not necessarily working in a fully vertical model. And therefore the pricing is quite a bit different. The margins are quite a bit different, even the online and offline distribution. It’s a pretty noisy market out there right now.
What would you say from your perspective? What would you say that today’s businesses versus even two years ago when you guys were getting started? What are some of the challenges that a company like yours is facing? And what do you think the challenges that a new startup or you know somebody who’s in business for the last six months is up against in a marketplace full of me-too products?
The Marketplace Today versus Two Years Ago
Jay Hartenbach: That’s exactly it. Yeah. And I think that that is the primary challenge is the me-too products and so for a new entrepreneur or someone’s looking to start a CBD company, in a way that’s a blessing, right? Because there is such sea of, you know, like when we first started or even a year or two years ago talking about, you know, hey, I want to start a CBD company or we’re just started the CBD company.
Every time I said that if you’re at a dinner party or if you’re even if you’re on an airplane, someone always, you know is more often than not others said, Oh yeah, my cousin is doing something like that. And it was one of those things where it was frustrating, I think because we were doing it in a much different way, right. And just lumping every CBD company under the sun in the same category is, I think, a disservice.
And so for new entrepreneurs, that’s the one onus but it’s also a blessing as to say, I know what the market has, it’s so readily accessible, I can see you know, you spend an hour online, you can get a great idea of what the landscape of products are being sold. Finding something that’s different, and the reason that you want to find something that’s different beyond just having something unique to sell to consumers. When you find something that’s different that you truly believe in then all of the other challenges that are going to come with the CBD industry kind of seem small, because you’re so I don’t know, impassioned or motivated by what you’re doing because you truly know that you’re doing something very different than everyone else.
Because the banking regulations which, in 2016, and 2017, were a nightmare. They certainly are getting better, but they’re still persistent. You’ve got retailers that are still skeptical, and you’re doing that education side of things. And then you also have consumers that are now starting to come around to it. But you know, now they’re starting to price shop because there are so many me-too products.
So I think the challenges for us right now are continuing to stay innovative. If we continue to do what we’re doing as a company, sure, we probably will be fine for the next year or so. But after that, we’re going to be in real trouble because at some point, there’s someone sitting in their living room, looking at what Medterra is doing and saying, Look, I know what they’re doing. And I can be completely disruptive to that business because this is what they’re missing.
I think the challenges for us right now are continuing to stay innovative. - Jay Hartenbach Click To Tweet
And so for us as a company, no matter how big we get, that’s what we actually You know, what is the who’s the person in their living room that’s trying to put Medterra out of business. And that’s the approach that any entrepreneur should be taking. It’s not malicious, that’s how you can find something unique and ultimately makes the market a lot better because it drives innovation and drives competition.
You know, I think you talked about private labeling, the private labeling thing can be good and bad. And I think not all private labeling is created equal. So if you’re private labeling with just a stock formula, then that’s I would highly recommend not doing it unless you have some completely unique marketing play or you’ve got some built-in distribution. You know, maybe you own a hotel chain or you own a spa. And so you’re just trying to create your own products. But I still would suggest away from that because you’re going to fall into that niche who trap.
Private labeling can be a fantastic way to get the business off the ground if you are working with the actual manufacturer and you’re working on some type of custom formulation or something that is, like I said, unique. Having that direct to farm relationship, I think is one very important not from just quality and consistency standpoint, but it’s also from scalability.
If you’re having any type of success in the CBD industry, you’re going to have a similar story or similar growth pattern to what we’re doing right where it was. We had no employees at the beginning of 2017, to now employing over 100 people. And so if you’re working with a manufacturer that doesn’t necessarily have access to a farm or the actual original supply, then as your business grows, you can run into an issue where they start sourcing from multiple different locations and they can bring in quality concerns.
So having that direct relationship with a farm, which most of them already do their own private labeling, or at least have some type of ability to manufacturer or process to hemp that they’re growing, allows you to alleviate that and at least you can source that and then kind of provide the logistics to whatever co-packer you’re working with.
Sonia Gomez: such great advice. We have so many people who are asking us about this all the time, like what manufacturer and you know, what product should I start with? And I always feel like and honestly, I’m quite verbal. I’m like no holds barred. You guys are asking the wrong questions.
This is not about a product my friends like this, no matter how mature this industry gets at its core will always be a relationship-based business and who you know, and what they know how to do is more important sometimes than how much money you have or how genius you are. You really have to find the right people who are doing the right pieces of the business were a direct complement to what you are able to do and find that core team to pull together that’s running towards a specific vision together.
Otherwise, you’re going to be left like you know, ordering steak off of the menu. It’s not that different except for the price in the environment right. So–
Jay Hartenbach: I actually could not agree more. I think that’s like that might be the most distilled and easily understood way of saying that. Really it’s and it’s not to say that, you know, to kind of continue your point, it’s not to say that you have to know everyone to be successful in the industry. I think it’s the long lines to is, you have to know exactly what you want to do in the industry.
And then it’s on to you to find the right people to do it and build that network, right, as opposed to going to a manufacturer and saying, hey, what can you make for me, and they’re going to give you what they’re good at, but it may not be necessarily aligned with what you want to do ultimately, with your company.
Sonia Gomez: Yeah, absolutely. I’ll give an example of what we’re talking about. Because I think this is something that you know, people do later, there’s still this idea that you want to be everything to everyone, right and the noisier that the marketplace gets, the more specific you have to be about the person and the problem that you want to solve with your products. And you have to in tandem be developing service that keeps them engaged with your brand because that becomes your business.
You guys are I call it the multi-prong approach. You’re, you’re approaching it with education, you’re using ambassadors, you have this fantastic product, you have this great story. And you’re spending a lot of time and money to distribute those things in an octopus manner.
Folks who are coming at this industry, like, Oh, we want to have a CBD brand. I’m like, okay, that’s cool. We have this really great name. All right, awesome. But they almost never can answer the question, Who do you want to serve? And what problem do you want to solve? Then I can tell you what products would be and dose and formulation would be most effective for that demographic for that specific problem and I can help you craft all of your messaging to communicate effectively and connect with those people so that they be build this culture within and around your brand and business.
And I can’t tell you how many times people are stuck there. They know they want to do it. They know that they should be doing it because the time and the stars and the planets are all aligning. And that’s all great. But they can’t answer the simple question. Who do you want to serve? And what problem do you want to solve with which products and for me, that’s really challenging knowing what kind of transformation I’ve personally experienced from products like this.
And from plants like this, and my life would be completely different as I know it, had I not found the right person to introduce me to the right products, and teach me how to effectively use them to improve my life. And so I’m protective over that on behalf of the consumer. I expect more from the brands and the businesses and the business owners, you know, as to what they’re putting out into the marketplace.
I hate this price war that’s happening right now. I think that it’s a terrible representation, of the quality of human beings but also a product coming out into the marketplace. Like who wants to be in a race to the bottom.
My question for you guys. I also love what you said, I just want to acknowledge this for a second. Imagine being around in the days of Steve Jobs and Bill Gates, like, going to sleep at night must have been a freaking nightmare, right? If you’re Steve Jobs or Bill Gates and being like, what’s this fucker gonna come up with tomorrow? I gotta make their freaking MacBook, too like you got to get to work my friend, you know, they need and it’s almost the same thing. I love what you said about, you know, always like you have to be looking at you have to assume that there’s another guy out there who’s as ambitious and as passionate about this movement as you are and that they may just, they just may catch up with you.
So my question for you then is what do you guys what do you building it like once you get to a certain place you get to start looking at instead of what you have to do what you really want to do knowing that you’re already cultivating a different in your community and within your customer base, what is your dreams that you guys get to start putting your time and energy and resources towards? What are some of the social groups that or you know, philanthropic work? How are you giving back to your community right now? And what’s next for Medterra?
Giving Back to the Community
Jay Hartenbach: Yeah, absolutely. Well, one of the just like the product side and getting to do what we want. My background being in biomedical engineering is always just kind of, I think, never been satisfied and always looking at the existing product portfolio we have and how do we improve it? And one of the ways that we’re doing that is with this liposomal technology, which dramatically increases the bioavailability of the CBD but also increases the amount of time and the concentration of it over time of it in the body once it’s consumed.
And I think that’s where that evolution comes from, doing some that we want. To your earlier comment about who you know, we ultimately knew we wanted to do a liposomal. This is really an older pharmaceutical technology that now is just because of innovation has become affordable enough to actually put it into a consumer product that we knew we wanted to do it, but we didn’t know actually how to do it.
And so we spent the last nine months, really developing this and actually developing our own patent because we had to be innovative in how we included CBD into the liposome. And that, for us, was something that was we really got to do something that we wanted to do, you know, we took nine months just to bring a proof of concept to market two years ago, we would have been dead in the water, right?
We would have heard of you ran out of money and the industry would have moved on. And so we’re finally getting to that point where we really I think are able to push the limits of technology and innovation in the CBD space which ultimately I think will be good for the industry and good for the end consumer. You know, because you’re going to be taking less CBD but still getting the same amount of effects and also taking other ingredients that have low bioavailability like curcumin in turmeric and things like that.
So We’re really excited about getting back to the community that’s something that I get really excited about. So we just partnered to one of the things that we’ve developed is this Medterra Assist program. So it’s for, you know, it’s a recognition that even though we have, I think some of the best pricing in the industry, that CBD is still very expensive. And so if you are, you know, low income if you’re disabled if you’re a senior citizen, or you’re a service member, so anyone that’s in that’s a firefighter or a police in the police force is a veteran, they’re able to qualify for the Medterra Assist program where we give a very significant discount off the product and that really has opened up just a variety of relationships.
So we’re working with a lot of veteran groups right now. We’re able to see the CBD being incredibly effective for it. We’re also able to see you know, people that I think really need it, right if you’re disabled, and CBD can be really beneficial. You know, more often than not, unfortunately, you know, a disabled person’s income is going to be a lot lower than someone that is, you know, healthy and able to move around freely. And so those are the programs that we get really excited about.
And it’s awesome because every month, every Medterra executive has to spend an hour to two hours doing customer service phone work. And the reason we really started it was because we recognize that consumers were calling in and we’re very transparent with their feedback and us being able to hear it directly as opposed to hearing it from the customer service rep. Who then would give it to their manager who then passes it on to us.
Hearing it directly allowed us to just move to be a lot more nimble, but we get a lot of people that call in that are part of that mentor assist program. Just think you know, and that for me is awesome. Being able to listen that as the phone calls come in and kind of reminds me of the early days of Medterra when I was the guy answering the phone.
Sonia Gomez: So sweet. I absolutely love that. How can I help people? You know, one of the things that makes me really excited and for the first couple of years of our business, we’ve only been doing online publication for two and a half years now. And for the first two years, it was basically a public service. Like, we weren’t monetizing by any stretch, we would not promote brands on purpose because we didn’t want anyone to feel like we had, you know, an ulterior motive.
It was all about the education and creating a community where people could feel safe, expressing their needs and their wants. And through that we’ve attracted a lot of folks who are on disability who are on Social Security who are, you know, recovering veterans who are a part of the 22. There’s 22 veterans who take their own lives every single day.
And there’s a lot of people who are a part of our community who have said, you know, today is another day that I get to have the breath of life because I’m a part of this group. You know, please help me I need, you know, I need products or I need someone to talk to or whatever it is, and so we become this resource. And I would love, love, love to be able to connect people into your program. Find out more about the program.
So maybe we can do a specific publication just around the program and really getting people enrolled and indoctrinated into the Medterra culture, I think would be fantastic. Just in our subscriber list alone, we have about 70,000 people who are just asking for daily communications around opportunities like this, to get plugged in to find out who are the companies that are doing things, right, who have give-back programs and, you know, who are empowering even the, you know, I like to say the servicemen and women that people who’ve put 30 years of service into, you know, our economy by holding a job that long and now are really struggling on social, you know, security and disability and whatever, or vice versa.
The veterans who’ve given their lives to serving our country like these are the people who are most deserving? I believe, and yet they’re left with the short end of the stick and a lot of time. So I’d love to be able to plug in our community, to the Medterra Assist Program, and get them more familiar with what you guys are doing.
Jay Hartenbach: Yeah, absolutely, I would. Yeah, let’s definitely explore that. We’re trying to grow out of the program. I think right now we actually have over 10,000 people enrolled in it. So, you know, the more the better. And for us, it’s just awesome too, like I said that feedback. It’s, you know, in some ways, somewhat selfish just because, you know, it’s, we always all obviously feel good about it and knowing that ultimately, our product can help those people that probably need it the most rewarding.
Sonia Gomez: Yeah, yeah. I love that. You know, in a segment of our podcast, you know, we have a little bit of a mixed bag of folks who are listening in Yes, you guys I just called you a mixed bag. We have the budding entrepreneurs and we have the existing brands and businesses and this has become a hub for them to listen In and have that like a me-too like I feel I feel that challenge or I totally love that piece of advice that that’s really going to help me.
Likewise, we have a lot of consumers who are listening in and they always love to check out just the story. There’s, you know, a lot of people who have been a part of the prohibition and are now celebrating the accessibility to cannabis and its relatives as well as the derivatives. But for the budding entrepreneurs and the existing brands out there, if you had to give one or two pieces of advice that might support them, you know, getting to that next phase, what would that be?
Advice for Budding Entrepreneurs and Existing Brands
Jay Hartenbach: Yeah, well, I think, you know, once you get to the, you prove out the online concept, then, you know, the next step really is building out that retail distribution. And for us, you know, the margins in retail are certainly not as high as selling directly to consumers. But what we saw as we started increasing the retail distribution was that both businesses are both I should say, sides of the business started doing better, right?
I think when people see the products at a CVS or Walgreens, then also see an ad for it online. Those are complimentary, right? Those are just multiple touchpoints. And so I think for every brand, even if there are concerns about what the future of retail looks like really should be a part of their roadmap to getting into that retail distribution.
I think for every brand, even if there are concerns about what the future of retail looks like really should be a part of their roadmap to getting into that retail distribution. - Jay Hartenbach Click To Tweet
And so the first thing I recommend is to start small and think there’s so many companies that say, hey, we’ve had a lot of success online, or we’re just getting started, how do we get into Target or CVS or Walgreens or whatever major retailer that they’re familiar with? That’s great. You know, I think that definitely should be a goal. But the best feedback, and I should say some of the best velocity that we have is actually at these independent retailers.
So right now we’ve got about 4000 independent retailers throughout the US that are carrying Medterra’s product. Not only is that relationship that a lot of the independent retailers or the independent pharmacies have with their consumers, really gauging and kind of this one on one, right? It’s not a very large store. You know, it’s where the employees are very familiar. And they, a lot of times, you know whether it’s a chiropractor or nutritional store, they know the same consumers kind of coming in and out, and they can have a much more one on one conversation about what CBD is what they can use it for, is really effective.
So my piece of advice would be, as you’re having success online, start building out a retail team. And it doesn’t have to be anything more than, hey, within the 50 miles of our location we want to get in 50 stores carrying the product. And what we need to do that is obviously building out some really simple cell sheets, which just basically is a one-pager that says these are what the products are, this is what the margin is. This is your price.
A sales deck, obviously highlighting why your brand is different than all the other brands that they’re carrying because most of these retailers now are already carrying CBD products so you can have the benefit of knowing that they’re open to the conversation. You just now need to convince them why they need to make room on their shelf for your product which you should be able to do because it’s something different.
And just get started from there and you’ll get that feedback. And then as you get bigger and bigger and you add 10 stores every week and next thing you know, you’ve got 30 stores, then start reaching out to the brokers and every one of the major retailers. You know, like I said, whether working with Albertsons or Kroger has a broker representing or as a broker representing Medterra having that communication.
So there’s already an established relationship. And you can go to that broker and say, You need to carry x y&z brand or my brand. Because we’re already having this success. I can show you the selter numbers in the hundred or 500 locations that we’re selling in. And this is why we should be able to present this to Walgreens or Albertsons and have a lot of success. And that’s, that’s kind of the evolution of what we did at Medterra.
And it was this crawl before we run mentality as opposed to just trying to take over the world at once that I think was ultimately key to our success.
Sonia Gomez: man, I could not have said it better myself. I had an interview last week. with somebody who’s financing a lot of these companies right now, and he said, the power of 100, you have 100 locations selling $1,000 a month per location within 100 miles of your house, you not only have achieved that or showcasing that you’re a hustler and that you’re willing to do what it takes to move.
But you’ve established a local business, which will ultimately be your bread and butter and you’ve built a million-dollar organization. So I love what you’re saying because it just reinforces that formula to go local before you go national. and prove that concept online is quite a bit of a different game today. You have to have a good amount of capital to be able to invest in a runway, but it takes money to jump in your car with your products and go and start to establish and build relationships.
So I second that motion. 5,000% be really committed to the success that you want to have and guess what it doesn’t take money to build your team. What it takes is vision, if you have a vision that people can enroll in, and they’re excited to follow you on and not, I mean, what do you think Steve Jobs looked like a big boss when he was sitting in his garage, like picking his nose and trying to build these little computer words? No, he had a vision. And that’s what people bought into.
So you have to have a vision as a company and brand owner and the people, they say when you have the what and the when, right, you have a product and you want to sell X number of units by this date, the what and the when, the who and the how we’re going to show up. But it all starts with your vision.
So I encourage you guys to spend 80% of your time planning and really getting laser-focused on what that vision is for your company, and then reverse engineer that to attract the key players who are going to help you build the revenue and impact of that business.
And final closing thoughts. Jay, I’d love to hear from you. What do you think the future of CBD looks like? we’ve just gotten a lot of scary letters distributed. There’s a lot of people who are panicking out there? Some folks are even calling it a bloodbath. What from your perspective is the future of CBD in the next six to 12 months?
The Future of CBD in the Next 6-12 Months
Jay Hartenbach: Yeah, well, one to address the letters, you know, I think the FDA still stayed on the path right, you know, to anyone that’s selling CBD products. I think the FDA has made it now abundantly clear to stay away from claims, you know, they are continuing on this path of whether CBD can exist as a dietary supplement or not.
We are on the board of the US hemp roundtable and so we’ve been working closely with our attorneys that you know, also are interacting with the FDA. There’s definitely a path forward for CBD existing as a dietary supplement. So there’s not any concern there. There’s only concerned if you are, like I said, making claims or, you know, trying to deceive consumers.
As far as the industry goes, I think the future is really bright. We, you know, 2019 was I think we look at, you know, the history of CBD and hemp was a very pivotal year because that was when the mainstream adoption really started happening. I think 2020 is really going to take that momentum from 2019. And kind of run with it.
We’ve got a lot of major retailers that we’re talking with that are excited about launching in 2020, as well as just I think the overall market starting to really understand CBD and starting to experiment with it. For the future of CBD, I think and I say this somewhat tongue in cheek is the future of CBD is much more than CBD.
And combined with that, I mean, you know, at this point, we look at the products and the companies that are doing really well. They’re going beyond just selling CBD products. They’re looking at CBD as an ingredient in a formula that has an overall more holistic approach to whatever treatment or concern they’re trying to address. And so I think that is where future the future of CBD, whether it’s other cannabinoids or minor cannabinoids being blended with CBD, so you’ve got great broad-spectrum blends, or you’ve got completely different ingredients like Tumeric or ginger, assisting and complimenting that CBD I think it’s also where this industry is going to go?
Because, one, there’s this competition and there’s this need for innovation. But at the end of the day, consumers are not taking CBD for the sake of taking CBD. They’re taking CBD because they’re ultimately trying to achieve some type of result. And if you can increase the likelihood of that result occurring or increase the result itself, you’re going to be much better positioned to do well compared to your competition going forward.
Sonia Gomez: How? Yes, I’m so excited by this interview. I’m really excited to see your guys’ innovation of products coming out with the liposomal technology I’ve been extremely familiar with for the last few years. That was one of the first things that caught my attention being somebody who suffers from neuropathy and you know, sleeplessness and the evening time, I’m always, always looking for either nano, miso or liposomal delivery systems and knowing your guys’ formula Because I am familiar, I gotta be honest. Knowing your guys’ formula, I’m really excited to see how it improves with the liposomal tech, it’s just going to take what’s good and make it great. And I cannot wait to share that launch also when you guys release that with our community, so we’ll definitely stay in touch with all of that. Any final words before we end today’s interview, my friend?
Jay Hartenbach: no, other than just, you know, making sure that you’re doing the industry right. So as people are looking to enter the space, if your objective in starting a company or even an existing company, is on your top five priority list is making money and I think just reevaluate what you’re doing because the money will certainly come it’s usually late. But believing in what you’re doing, asking that why I’m doing this is going to ultimately be successful.
The companies that are purely seeking the profits and looking to cut corners are quickly being weeded out. And so being honest with yourself, I think is the first step in building a successful company.
Sonia Gomez: Yes, Spoken like a true boss. That’s so true. And for all of you guys are listening, get with the program. No, I’m just kidding. You guys really have to tap into your Why? Because at the end of the day, nothing is going to get you out of bed to continue to do this when you get kicked in the nuts on this road like this is a gauntlet, my friend. And you have got to be ready to run fast and hard towards the future that you want to create, but also enjoy. And it’s not always for you but for the people whose lives will be impacted by the work that you do.
There’s two ways you can measure your success, your impact and then through your income. And you have to decide what kind of person you are. Are you running for income? Are you running for the impact? Because the money is always going to be there no matter what you decide to do, but the difference that you make starts at the beginning.
Jay, I want to thank you so much for your time today and sharing your story and I’m really excited about our continued building of a relationship and collaboration moving in the future here.
Congratulations on the incredible success of Medterra. And it must feel really good yourself to be able to celebrate the incredible impact that you guys are making. So I appreciate you guys always being a leader in this space and an excellent example for the industry. And it’s my pleasure to have you on today.
For those of you guys who are tuning in with us, thank you so much for being a part of this community. And I want to just acknowledge you guys for liking and sharing content just like this. And when you share today’s episode, you will be a part of helping us to continue to impact hundreds of millions of people’s lives around the world quite literally moving the needle for legalization and changing the way that our families and communities are thinking about the way that they live and feel and function on a daily basis.
This is The Hemp Revolution Podcast. I’m your hostess with the most s and I can’t wait to see you guys on the next show.
Jay Hartenbach: Thanks, Sonia. Thanks for having me on.
Sonia Gomez: Yeah, I think So much, Jay.
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