Cannabis is a fast-growing industry where rules and regulations are constantly changing and if you are new to this industry, you may find yourself in unchartered waters.
In today’s episode, James shares the importance of meeting people face to face and some actionable tips to stay relevant in this space.
When new regulations come out, we all have to adapt. And so even if you’re aiming for something, you have to be prepared to alter course if the market moves. – James Higdon
Some Topics We Discussed Include
3:26 – About James’ background in journalism
5:00 – What inspired him to move into the cannabis business
7:03 – The wins and challenges of the business
13:07 – Their key to success
20:57 – His key points of focus as a business owner and a journalist
27:05 – Key pieces of advice to entrepreneurs who want to get into the industry
People Mentioned / Resources
Connect with James Higdon
Connect with Sonia Gomez
Sonia Gomez: What’s up, guys? Sonia Gomez coming to you live from Denver, Colorado. Super excited to be here on another episode of The Hemp Revolution Podcast where we are telling and sharing the stories of the pioneers who are pushing this incredible industry forward. It is our mission here at The Hemp Revolution Podcast to share with you the truth about cannabis and hemp and the industry that is surrounding it so that you can make empowered and educated decisions about how you want to care for yourself, the people that you love, conditions you may be suffering from or otherwise preserving that incredible healthy lifestyle that you already have.
If you are a budding entrepreneur looking for tools, resources connections, we are able to help you by checking us out at theemeraldcircle.com and if you are a person who is looking for products that you can trust to deliver the results that you’re looking for, check us out on medicalsecrets.com for our favorite picks on products.
In today’s episode, we are going to be telling the tale and visiting the story of Jim Higdon who is the author of Cornbread Mafia and the co-founder of the Cornbread Hemp Company. His book the Cornbread Mafia is about the largest domestic marijuana syndicate in American history. Over 70 men arrested on 30 Farms in 10 states with 200 tons of cannabis between 1985 and 1989.
He paralleled the book’s success into the cannabis journalism career writing for politics. Why did I just get tongue twisted? Writing for multiple publications including the Washington Post, and many others. His co-founder Eric– Say his last name for me.
James Higdon: Zipperle
Sonia Gomez: has an MBA from Bellarmine University in Louisville and e-commerce background. They joined forces in late 2018 to launch Cornbread Hemp, and to start to shipping top-shelf CBD products in April of 2019. One of my fellow journalists and cannabis advocates, cannapreneurs, our good friend, Mr. James Higdon, thanks so much for joining us.
James Higdon: Thank you so much for having me. That was a great intro. I got one quick check on the pronunciation of our town. So I know in Colorado, there is a Lewisville. And so lots of people from Denver call it Lewisville. It’s Louisville. So we get that from Denver people a lot.
Sonia Gomez: Right now I’m dubbed the Denver person. I guess I’ve been here long enough. I’m okay with that. James, tell us a little bit about your background and how you got into this crazy rat race of the hemp and cannabis industry.
James’ Background in Journalism
James Higdon: So I grew up in central Kentucky. I just happen to be from the small town where this crazy thing happened where a bunch of men and my parents’ generation were arrested for growing outlaw cannabis in a sort of a superlative amazing way and that frustrated federal law enforcement to such an extent that because these 70 guys they got arrested is superlative and noteworthy on its own, but what’s really crazy is that none of them talked.
So none of them talk In exchange for a lesser sentence to point a finger. So, federal law enforcement was really frustrated by it. And so instead of prosecuting these guys, they could only hold a press conference and like lay out their prosecution case, to the media.
And in the course of that press conference in the summer of 1989, they call these guys the Cornbread Mafia. So, that’s where that term comes from. And it was sort of a scarlet letter from my hometown for a long time. And I was able to come home after going to journalism school, haven’t getting a journalism background, sort of crack that open and write the story about what really happened. And then I turned that into a journalism career.
Sonia Gomez: Amazing. And so as a journalist inside of the cannabis and hemp movement. Share with me some of the things that have stood out to you. And I have to be honest, being a journalist, and also a cannapreneur or hemp entrepreneur, very, very different. So, I’d love to hear a little bit about what was it about the stories that you are capturing and writing about and sharing that inspired you to move into the actual entrepreneurial ship and of business ownership in the hemp industry.
What Inspired Him to Move into the Cannabis Business
James Higdon: So it was about this time last year, you know, October of last year I was covering the hemp harvest for Politico Magazine in Washington DC. I was out in Western Kentucky for the hemp harvest. The angle the story at the time was the proposed felon ban in the Farm Bill had been slipped in at the last minute as a lifetime felon ban so that no drug crime felons could participate in the hemp program at all.
And so I went and reported a story about a place in Western Kentucky that was harvesting 100 and some acres of hemp and the CEO of that company was a felon, but he wasn’t a drug crime felon. He was a tax evader. And so that made it okay.
And in the course of that story, I managed to get a quote from someone who was going to get kicked out of the hemp industry because of the felon ban. And what he told me is, does it say in the farm bill that if I get caught moonshining, I’m not allowed to grow corn.
So, that story ran about this time last year before the passage of the Farm Bill. And I think that my journalism in that story rolled back the final version of the felon ban to 10 years instead of a lifetime.
But in the course of writing that story, and seeing the hemp harvests come in, I realized that had one opportunity to get out of the bleachers and into the game, it was one chance to get into the space in a productive way, more productive than just being a sideline reporter as a journalist, and so I emptied my Rolodex. I got an investor. I partnered with someone with a business e-commerce background and we went to work.
Sonia Gomez: Okay, so tell me about the work what are the wins? What are the challenges?
James Higdon: Oh my gosh.
Sonia Gomez: Remember we only have a set amount of time.
James Higdon: The wins are really we’ve been able to distinguish ourselves in a very crowded market. Everyone knows that the CBD branding space is crazy crowded. There’s thousands of brands. Buyers for retailers are very guarded about taking calls from people like me because they’re just bombarded by branding people trying to get their products into shelves. So we’re been able to distinguish ourselves in that crowded field because of our branding. Because we’re named after a legacy of outlaw cannabis.
A lot of the branding in the space is people who want to have their customers think that hemp is a brand new thing that it just got sort of created plus the branding is very shallow, and not much more than graphic design concepts and so having a brand story that goes back, not just to the outlaw past of a generation ago, but all the way back to the 200 years of hemp growing traditions in Kentucky, really helped us distinguish ourselves in the space.
So for starters, our branding story is deep and rich and long, and so that we can talk about all day, it really leads us into being able to advocate for criminal justice reform and restorative justice in the cannabis and hemp space. So that’s something that’s very brand-centric for us being able to advocate for formerly incarcerated people. And as we scale up, hire formerly incarcerated people as part of our growth plans.
So we’re registered as a public benefit corporation so that we can become a certified B Corp after we’ve accumulated enough data to do that sort of thing. So that’s been a win for us.
Product diversification is also a win. We do right now a high purity CBD full-spectrum distillate for the Sativa terpene profile. And already that’s unique in the space. Here’s what that looks like.
I don’t have any samples of my topicals handy, but instead of doing a sab or a bomb, we’re doing lotions made from our full-spectrum distillate. So it’s one of the only full-spectrum lotions on the market. Most lotions are isolated, and most full-spectrum products are sabs. But we’ve developed a method to emulsify a full spectrum distillate into a paraben-free lotion that’s very good. We do a 200 milligrams skin lotion and a 500 milligram methylated lotion for deep tissue work. And it’s attracted quite a loyal regular following and we’ve been really successful with our lotions.
Sonia Gomez: Nice.
James Higdon: And then, sort of the process of doing all that we’ve built sales month to month. We’ve been launching products since April. We’ve built sales from month to month. We’re at 100% revenue, what our initial investment was, and we’ve completely rebuilt our supply chain. We’ve lowered our cost of goods, and we’re able to competitively priced at a distributor level, as well as working with talking to major retailers.
So you know, there’s a lot going on. And we’ve got a couple we’re about to introduce, certified USDA Organic into our product line. And so that’s really exciting. Right after Thanksgiving, we’ll have USDA certified organic CBD oils at two different purity levels.
Sonia Gomez: Beautiful. Congratulations. What an incredible evolution in such a short period of time. I’d love to know what you attribute your success to because obviously, the landscape looks different for everybody. I talked to companies who are you know still really struggling with cash flow three years into the business.
And I talked to companies who in six months are able to recover investment and get cashflow positive. What do you think– You mentioned the efficacy of the product, product differentiation. One of the things which I’ll touch on more here in a moment was how you’re telling the story and the history behind your brand. But what do you think is the key is a key differentiator for you and your guys’ company or approach that is making this a win for you when so many other people are losing.
Their Key to Success
James Higdon: The early stages of hemp, the conventional wisdom was the vertical integration was the superior method of developing this business. But vertical integration makes you– What’s the opposite of nimble makes you clumsy? Like it’s hard to adapt to the marketplace if you vertically integrated do X and all of a sudden the market goes to Y. It’s hard to pivot and move.
We’re invested at turbo in the brand marketing center first working backward. We’ve developed relationships with farmers and processes, but we’re not doing that ourselves. So, our investment is in R&D, product formulation, and marketing so we have an easier time moving with the market and finally where our customers are.
On the e-commerce side. One of the challenges that we’re all facing is ad bans from major platforms, Google, Facebook, etc, etc. So, finding ways to reach audiences and communicate with them by email is a critical feature of developing relationships with the customer base and we have to be creative about how we go about doing that sort of work. But a silly ad band is not going to stop us from figuring out how to do that.
Sonia Gomez: How are you bridging past the gatekeepers in retail settings? And I hear, like, so many different creative ways to do this. And I really orient this podcast.
James Higdon: Like, what’s the most creative way? Like, I’d love to hear good ideas like how do we–
Sonia Gomez: Go back and listen to some of the episodes we [00:13:28 crosstalk] Yeah, we break it down. There’s a couple of really great ways and I’m probably, well I haven’t yet found somebody who’s breaking down the barriers in a better way than me so far. I’ll share in a minute in a minute how I’m doing it and you can take it and run if you want.
James Higdon: Well, you know, so there’s nothing like a warm introduction that helps get you where you need to go.
Sonia Gomez: So you’re leveraging your Rolodex and a lot of–
James Higdon: As a journalist, LinkedIn was more of a, like a reach out tool for me trying to find sources. It’s a cleaner, easier place to find people than Facebook sometimes.
Sonia Gomez: [00:14:13 unintelligilble]
James Higdon: Right, but like LinkedIn has taken on a whole new life as doing business networking and just like reaching out and constantly connecting with people on LinkedIn. And anytime I see someone at an event talking like that, I look them up and connect with them on LinkedIn immediately because then you have access to their network. And you can really sort of build out a business network in a dynamic way, I’ve definitely found retailers that I’ve built relationships with through LinkedIn.
Sonia Gomez: Yeah, awesome love that. I’ll share a little bit with you on how we’re doing it and this ties in right along with the brand story. I literally cannot emphasize this point. And that’s because I built my entire business off of this thing and where most people even like yourself, you mentioned getting shut down with online advertising. Everyone else is getting shut down. I’m thriving. I’m like running past the competition right now with online e-commerce marketing. And it all starts with the story. I’ll get in with you offline like specifically what we are doing to break the barriers of Facebook, Instagram, Tiktok, so on and so forth on the mainstream channels
James Higdon: We are banned from Tiktok.
Sonia Gomez: I’ll teach you how for sure. So, it’s all in the story and I call it stories selling. How you craft your message to meet the marketplace that you want to serve, cannot put enough emphasis on this and I love the history and meat on the bones that’s behind your brand. I mean, it’s such a key differentiator and how that’s positioned in the marketplace. So super powerful. And how you attract strategic relationships based off of that.
At the end of the day, whether we’re talking about the weed industry, or the cannabis industry of pre circa 96, and in the Emerald Triangle in California, or post 96, or even post 2010 as things have been evolving and cooling and bubbling. I mean, all of the things that have been happening over the last couple of decades is pretty incredible.
But at the end of the day, having the story behind who you are, and what you’re here to do is the most powerful differentiator and then having those key positions. At the end of the day, This business is all about the relationships that you build. And you do that through your story. What your experiences, why you do what you do, the way that you do it, all of these different things.
I’m sitting here right now holding– this box is USDA Organic products that range from body lotions to lip cells. There is no new ideas. There’s only ways to innovate and create a cult-ture. A cult following around who you are, what you stand for, and what your brand and business is setting out to do.
So I will definitely share more with you about how we’ve gotten shut down off of Facebook. And our accounts brought right back up how we lost messenger lists of 460,000 people and got it back up, you know, kicked off of Instagram, Tiktok, every single one of these channels, Google and brought right back up.
I can share with you all of the different ways that we’ve been able to do that because I know that advertising is one of the biggest challenges in building the business, especially if you want it to be e-commerce.
I know that advertising is one of the biggest challenges in building the business, especially if you want it to be e-commerce. - Sonia Gomez Click To Tweet
James Higdon: Well, right I mean e-commerce is a key component of this. It’s about balancing e-commerce and retail consumers like where they want to be like some people– CBD is a funny product. Some people want to buy it online and have it delivered directly to the door and some people want to show up in a shop and pay cash so that it’s not on their credit card.
Sonia Gomez: Yes.
James Higdon: You got to meet people where they are, so e-commerce is a key part of getting to them and it’s crazy to me– I was just emailing what the journalist– hopefully, it’s a bigger story that these tech companies have Terms of Service that are behind the times a federal law, and there’s no reason for it to be like FedEx won’t ship a CBD product but UPS will. It’s it’s arbitrary. And it would be hilarious. It wasn’t getting in our way every single day.
Sonia Gomez: Yes
James Higdon: Reaching the people that that ought to be reached. And Amazon won’t allow CBD on the packaging but will allow hemp on the packaging. So you have some legit CBD brands relabeling products so it doesn’t say CBD so they can sell it on Amazon plus a bunch of fly by night snake oil people who are just using hemp seed oil and calling it 3000-milligram hemp oil and charging $9.99 for it. It’s very frustrating.
Sonia Gomez: Yeah, Yeah, I would agree that are quite a bit of point of– quite a few points of frustration when it comes to transparency and honesty in the industry. That’s probably been one of my biggest challenges is hearing terms that are not properly being used or hearing mislabeling, just not having that full transparency and honesty, which is why I like working with this merchant processor that I’m working with right now. They are partnered with mainstream banks in New York City. And their compliance checks you have to have up to date within the last 60 day, COAs for every product, every batch, the compliance piece that they built into the whole thing takes out so much of the guesswork for both consumer but also to keep things mainstream banks interested in building the business with you.
What are some of your favorite stories that you like to tell or share when it comes to the industry? Once a journalist, always a journalist, so I know that you’re certainly a part of the buzz that’s going out into the space. What are some of the key points of focus that you have on behalf of your business but also on behalf of the industry because I know you’re still working on her behalf too.
James Higdon: Well, you know, I think you said before, this whole industry is based on relationships. It’s a whole new industry where all these people have flooded into the space from every different walk of life, every different pass profession. Lots of them are good-natured, goodwilled, trustworthy people. And there’s also straight-up criminals. And sometimes it’s difficult to tell those people apart. And you don’t know who you deal with until you’re dealing with them.
So, one of the important things is going out to some of these expos and conventions just to meet people and do real in the flesh networking with folks, because there’s really no substitute for it. We went to Tennessee to the Southern Hemp Expo.
Sonia Gomez: Yeah, the SHE expo
James Higdon: Yes, put on by the same people who do the Noko ended up meeting people from Chicago to help us get our roots into the Chicago market. So, we went to Nashville to get in Chicago, but that’s the nature of the networking part of this industry.
Sonia Gomez: I went to Oregon to get tied into the Bahamas. So, [laughter]
James Higdon: makes sense.
Sonia Gomez: Makes no sense at all. But, you know, I guess it’s still somewhat of a breadcrumb industry, right? Like, back in the day, I remember being in California and you knew one guy who had to call a guy, who had to get in touch with somebody else so that they could get you what you were looking for. And now it’s a similar process, but everybody has somebody and everybody has something that is the best in the marketplace.
James Higdon: And they’re on LinkedIn.
Sonia Gomez: [inaudible] quite a bit more discernment.
James Higdon: There’s still a lot going on with like hemp flower, shopping for hemp flower in bulk is a very troublesome process because there’s no good open market for hemp flower, no grading process, no way to know how and where it was cured. There’s just all these open questions and then compliance like where’s it compliant?
Oregon compliance or Colorado compliance is different than Kentucky compliance and now these USDA regs that just come out, the senators from Oregon, Wyden and Merkley just [unintelligible] to the USDA, asking for a pre decarboxylation testing standard for the THC because the one that proposed the Kentucky style post decarbox 0.30 standard is just going to be brutal. The industry is really going to hurt next year if that’s the standard by which we’re growing.
Sonia Gomez: Yeah, absolutely. I completely agree. I’ve watched even just in the last couple of months people go into panic mode. And if there’s one thing I can convey from this episode is don’t fucking panic people. Stop panicking, that’s when you drown.
I’ve been a part of this industry for so long that you think the sky is falling. Every day you’re Chicken Little and you think the sky is falling and they just have to go on the full end of the extreme to come back to the center. And it takes a lot of industry advocates who can educate on the process to make all of those things possible.
But in the last couple of months, people have just been panicking around the new release with regulations and dumping the prices, dumping the quality, all this shit product is going into the marketplace unfinished. It’s awful. And it’s only going to validate what they’re afraid of if everybody panics and makes the move from panic, you’re gonna sink the ship. So kill people kill.
James Higdon: I would encourage, and I’m sure everyone in the industry is sending a comment to the USDA, that email address is [email protected] and especially for your Colorado audience, People need to be contacting Senator Cory Gardner‘s office and letting them hear it because senator Cory Gardner is in a tough reelection race. And if he asks Mitch McConnell to tell the USDA to back off on this testing, it might actually get done.
Sonia Gomez: Agreed. All of you guys who are listening, please, I encourage you anyways, everybody always asked me, Well, how can I get involved in the industry? Well, you can start by getting involved in your local municipalities and start finding out what your local government is up to. Who are your advocates who are your friends in this space and shore up with them?
This is really going to take a community effort in order to see legalization truly realized, let alone regulation that allows for a fair business to be able to grow and thrive. So please, please, please get involved and find out what your local laws are. Stop worrying about the macro picture and look at the micro picture because every one step gets us that much closer to the goal that we are all working towards.
In this segment, you generally in these interviews, James, we do something called the words of wisdom. And I love to add value to our community. We’ve talked a little bit about the challenges. We’ve talked a little bit about the key differentiators. And for budding entrepreneurs or people who are standing on the sidelines, maybe they have money, maybe they have farms, maybe they have a unique skill set and they want to get involved in the industry, but perhaps they’re a little gun shy and don’t quite know how to get started, what would be some key pieces of advice that you could offer them while they are trying to figure out how to join this incredible industry?
Key Pieces of Advice to Entrepreneurs Who Want to Get into the Industry
James Higdon: You know, it’s about asking questions with people that you’re like, you know, if there’s a role in a space like nothing like reaching out and talking to people, you know, people around here reaching out to me even asking me these similar questions and a lot of times I don’t have answers for what they’re trying to do, but I’m happy to give them a couple of minutes to talk to help like point them in the right direction.
Business owners are asking me is it okay for me to put CBD in a beverage. Will the FDA come and take me down and I explained to them that it’s the health department in their town that they’re most worried about and they should reach out to them because that’s the where the enforcement what happened.
So people need to understand, like this concept of what the business, what they’re doing. what asked aspect of government does it come up against who’s the regulatory body because if you’re a farmer and you’re trying to get a license to grow hemp, that’s really easy, you know, you need a hemp license to grow it. So you go to the ag department to get a license.
But if you’re retailing or trying to get into e-commerce, you need to figure out how you’re interacting with the real world and what the challenges, the unique challenges are for the CBD space are so that when you grow your business, you can be nimble and flexible because the business models are changing. When new regulations come out, we all have to adapt. And so even if you’re aiming for something, you have to be prepared to alter course if the market moves.
Sonia Gomez: Yeah, absolutely. I will second that. Generally, I do a little three key points, but I love this theme of macro versus micro. The conversation that is happening right now and the movement that is happening is macro. But the difference that you can make starts with the micro choices that you make and the micro awareness that you find.
For instance, who is going to govern the next choice that I make? Honestly, the FDA and the FTC aren’t even going to bother with you until you start putting Denson bank accounts. Right. So understanding that what your local government is doing, your health department, the ag department, the Department of Revenue, all of these different people are working together to create regulation around how they want your city or state to operate.
Get plugged in, get some first name basis happening. Find out how you can get involved in that level. If you have a skill set tie into a company that’s already capitalized. If you have capital, find somebody who actually knows what the F they’re talking about, and get verified results and references from them before you put your art and money behind. to them.
And then finally, once the conversation does become macro, and you see that the ripple effect of your efforts is in fact making a difference, then you can start to get involved with the macro challenges that are associated with this industry. And from now until then, focus on what’s right in front of you put the blinders on, get really familiar, what’s happening in your local environment, and start to participate with your time and energy before your money and financial capabilities.
Get involved with your time and energy to figure out where the gaps are in your community and work to fill those gaps. It’s not always about creating a new set of problems but finding a way to solve the ones that are already in existence that will help you be the most successful.
It's not always about creating a new set of problems but finding a way to solve the ones that are already in existence that will help you be the most successful. - Sonia Gomez Click To Tweet
That’s what I love about your company James is not only do you have the story behind what you’re doing, but you filled a gap in the industry like there wasn’t– a few months ago there were not lotions like this that were full-body lotions that work both male and female friendly and now you’re going to move into USC organic like such an exciting time for you where can people find more about your books or products?
James Higdon: That’s great. Thank you very much. Well first of all for books like always go talk to your local independent bookseller about Cornbread Mafia and have them buy copies and stock copies of the Four Red Mafia. We’re also doing some really interesting business with bookstore retailers selling the cornbread mafia book and the Cornbread Hemp Product side by side.
Independent bookstore retailers are always interested in diversifying their shelf space and CBD is a great way to do that. But they need to do it in an honest way. That makes sense to their business. So connecting CBD products with what the book is really sort of right up a booksellers alley.
So first, you know, talk to you like you’d be having a relationship with a bookseller. Talk to them about Cornbread Hemp Mafia, but it’s on Amazon. You can get it on getting on Amazon. Audiobook on Amazon, Audible.com. There’s a new edition of the book that just came out earlier this year with a new final chapter. So make sure you get the updated edition.
For the Cornbread Hemp where at cornbreadhemp.com is the easiest place to find us or @cornbreadhemp on Instagram and Twitter. So follow us @cornbreadhemp on those platforms. We do a lot of business on e-commerce on Cornbreadhemp.com so that’s the best place to reach us.
Sonia Gomez: Amazing all of the different social handles, as well as the websites that were just mentioned, for both literature and product, will be listed inside of the blog post that is surrounding this video here. Make sure that you subscribe and take special note at our show notes and highlights from today’s show. Any final words before we do the close, James?
James Higdon: Oh no, you got it. So you take it away.
Sonia Gomez: All right, sounds good. I want to thank all of you guys who are tuning in to The Hemp Revolution Podcast and being a part of this incredible movement to ensure that the highest quality products are being brought to the marketplace and that people just like you can benefit from all of the incredible cannabinoids that are made available through these products through the pioneers that are pushing this incredible industry forward.
If you liked today’s episode, make sure that you share it around and subscribe to your favorite method of being able to get more information just like this. If you’re a budding entrepreneur, check us out at theemeraldcircle.com for resources, relationships, tips, tools and tricks that you can use to navigate your way through this crazy but totally incredible industry and if you are a person looking for products you can trust, check us out on medicalsecrets.com for our favorite picks. I’m your hostess with the mostess Sonia Gomez and this is The Hemp Revolution podcast. We’ll see you on the next show, guys.
James Higdon: Thanks, Sonia.
Sonia Gomez: Thanks, James.
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