Crescent 9 Built Something From Nothing, Now The Government Wants To Take It Away

Nate Fochtman sits down with Joe Garrity, Co-Founder and CEO, and Joshua Katzenstein, Chief Revenue Officer of Crescent Canna and Crescent 9 THC Seltzer - one of the fastest-growing hemp beverage brands in the country, now sold in 20 states.

What started as a scrappy CBD startup in New Orleans in 2019 became a brewery, a 40-person operation, and the number one brand in Nielsen data across multiple markets. Now, like every operator in this category, they are staring down a federal ban that nobody voted on, nobody debated in committee, and nobody can get a straight answer about.

Joe and Josh pull no punches. They talk about what it felt like to build something from nothing, nearly lose it in Louisiana to a politically connected opposition, and win anyway - because constituents picked up the phone. They talk about what this ban is actually costing real people, why the grassroots pressure worked once before and has to work again, and why hemp beverages deserve a seat at the table that flour and gummies have made harder to pull up.

This episode is part of the Regulate Don't Ruin NC campaign, sponsored by Tryon Distributing, Crescent 9 & Torch Drinks - a call to action for North Carolina residents, retailers, distributors, and consumers to make their voices heard before it is too late. 

If you live in North Carolina, sign the petition and get involved at RegulateDontRuinNC.com.

Topics covered: Crescent 9 origin story, building a hemp beverage brewery from scratch, pricing strategy against craft beer, the federal hemp ban, the Louisiana grassroots fight, Mitch McConnell and the Farm Bill, hemp beverage safety data, the child safety argument examined, why beverages must lead the legislative path forward, and what operators need consumers to do right now.

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Transcript

SPEAKER_01 0:00

Josh Katzenstein, Chief Revenue Officer for Crescent Canna and Crescent9 THC Seltzer.

SPEAKER_03 0:05

I'm Joe Gertie, the co-founder and CEO.

SPEAKER_01 0:08

So Crescent Canna launched uh as an M company back in 2019. Uh there's three founders from New Orleans and one from Charlotte. And uh at that time, you know, we just started making some CBD products. Uh, we were manufacturing them in Charlotte because uh that co-founder had some manufacturing experience. Um so we started selling CBD products, you know, throughout the Southeast, but primarily in Louisiana and North Carolina. And uh as the legality of Hemp Drive THC became more clear, we started offering some THC edibles in 2021. And uh we saw some significant growth once we jumped into that space, but we kept talking about what we could do that was more unique. We'd seen some beverages out there and thought maybe that was the best path forward. So, in order to do that, we hired a sales director who had been working at Republic National Distributing Company in New Orleans for about 10 years. And we also acquired someone with some formulation experience from the cannabis industry out in Oregon, uh, who had grown up in New Orleans. He uh wanted to move back, so we brought him in. And after some months of RD, we launched Crescent 9 THC Seltzer in February 2023. Uh we launched it here in New Orleans, which is where Joe and I both live, and we got it here in time just for Mardi Gras that year. Uh, fast forward uh about three and a half years later now, uh we sell Crescent 9 in 20 states. Uh it's available in every state in the southeast, but we go up north to New Jersey on the East Coast, as well as Wisconsin and Illinois in the Midwest. And uh, you know, we obviously continue to sell you know some of the products that help us get to this point, but our primary focus is on these beverages because we are seeing incredible success across you know several states and several channels. And uh that is you know pretty much the story.

SPEAKER_03 2:09

Yeah, to back it up a little. So when we were selling gummies originally um before we entered the beverage space, we you know we we started making some money and we wanted to do something to to scale, to get bigger. And and ultimately we decided that gummies are no offense to the gummy manufacturers. They're a little, they're fairly easy to make. There's not really a lot of complexity to those products outside of different packaging changes and maybe the way you actually distribute them and sell them. Uh, so we looked into copacking originally with the product and figuring out how we could have somebody make it for us uh to see if this was gonna work. And what we found right off the bat is that the cost going through a copacker or going through a white label co-packer was actually gonna make our product more expensive for us to buy than what we wanted to sell it to distributors for. So we would have been losing money just to figure out if this were, I mean, just without even accounting for expenses, we would have been losing money. So we, after a few months of trying to figure out somebody to make this at a reasonable price, we just built a brewery, basically. We we just pulled the trigger. We we took a new space in Charlotte, a bigger one uh that was more suitable for beverage manufacturing. We bought two seven barrel tanks, we bought two 30 barrel tanks, uh, you know, a mixture, all the all the stuff you need to make this happen outside of a canning line. And we just did it. We just said, let's go. And we did not know what we were doing. And that's you know, that that is the truth. We showed up in Charlotte for the first run and we kind of looked at each other and we're like, all right, so how are we gonna we use a lot of real stuff in our in our products? We use pure's and and puree's are not as simple to manufacture with as maybe we thought. So at a small scale, when we're doing batch sample, you know, just doing bench top uh runs to see what it tastes like, you know, fine-tune the flavor, the recipes. You can homogenize puree and THC with it with a little handheld uh homogenizer. And we get to Charlotte and we're like, okay, we need to homogenize, you know, whatever it was, 400 pounds of puree. And so we're sitting there, and I stayed up all night the first time we did this. And I'm sitting there with a hand mixer and two liters at a time, just going for 30 minutes and then dumping in and going for 30 minutes and dumping, and after about 12 hours of that, I was like, okay, this is not sustainable. Like there's no, there's no world where we can have 15 employees doing this like all day, every day, just to get enough puree in our products. And you know, so we we kind of had a decision where we're like, should we should we go and and retune our recipe? Should we basically start from scratch and get rid of the purees and and push postpone a couple of months, or can we find a piece of machinery that'll do this? And I just haven't happened to find somebody online, um, I think it's called like Texas not Texas Instruments, the calculator company, but something along those lines. And they had in stock a $50,000 homogenizer with a jet engine in it, basically, that is that does exactly what we needed. So we ordered that, and and that really made the process a lot simpler. But you know, we we showed up at MJ BisCon in in uh November of 2022, and we had this beautiful booth. We had our you know our our our colors, it was huge, it was awesome. We had these beautiful cans, uh, and we had no product. And we weren't even close to having product yet, realistically. We thought we had a reasonable time frame, and we just didn't. Um, so we're handing out these cans, right? And not handing out, we're showing people, and we're telling them this is not the product, there's nothing in here. And by the time the convention is done, 50 of the hundred sample cans we had are gone. So the first 50 times that people probably tried Crescent Nine, they were just drinking in like tepid water from like some random brewery that we found to seal the cans for us in Vegas. Um, so it was an it was an interesting start. And then we actually got going, it was Mardi Raw of 2023, which down here is a big deal. Um and it it just hit, man. Everyone bought it. We we sold out almost immediately. Um, and for the first year before we really learned how to scale our operation, we we were behind on manufacturing. Um Josh can tell you. I mean, he's like, man, I could really sell some products if we had some products. Um, and and then since then, you know, it's it's it's gone well. I mean, we're you know, we're the number one brand in Nielsen. Um we've you know, we faced a lot of criticism from the industry because our our target price was to be around the same as craft beer. And when these products first started coming out, I mean, that was not what people were charging. They were charging $20, $25, $30 for a four-pack. And we just never thought that was sustainable. So we faced some industry criticism uh early on. But I think what other people have found is what we found early is that if you build something to scale, then these costs go down tremendously. And if you're not operating these businesses like you're a drug dealer, then you don't necessarily need to make drug dealer margins.

SPEAKER_00 7:05

So it's it's been uh I never thought about that transition to the point yet.

SPEAKER_03 7:11

Yeah, I mean, early on, everybody was that's how it was. Everyone was trying to make, you know, two, three times their money on everything they were doing. And like that's just not it's just not sustainable for an industry. And it's not you're not gonna grow, you know, who's it's it's it's not a it's a novelty product if you're paying ten dollars a can for a five milligram product. Um and we and we wanted these things to be mainstream, and that's that's what we've always believed in. So we've we've followed down that we've followed that path for a long time now. And I think um I don't want to say that we, you know, other people have followed, but other companies have have matched our price in some cases, and and most of the others are just a dollar or two behind now. So it's uh it's been a a wild ride, to say the least, watching the industry just kind of change dramatically since we launched, and us as a company also changing.

SPEAKER_00 7:57

It's interesting too, like that you took that mentality of wanting to compare compete price-wise with craft beer, because that's that's kind of the target consumer and or the target mindset of comparison for that consumer. And I think obviously we have other demographics of consumers that consume THC beverages, but for a good piece of it, that's a good barometer because in the industry, you know, everything because there's not a strict regulation that's in place right now, there's really not a price tier, like that's that's actually an average. Like in craft beer, you know, we go out and we set everything up, and you have you know where you need to be. If you have an IPA, this ABV, you gotta be around here, you gotta be around here. So the industry, like I started working in the hemp space with the same thing with gummies and flour 2019. Uh, and then beverages started to started to come in a couple years later. But you're exactly right. It's it's it's um it's one of those things that trying to set these tiers so that the consumer's not as confused as well, allows that faster adoption rate from consumers to kind of transition and or supplement their their drinking habits with with THC products. So, Joe, take me back, go even farther. And with you and the founders, give me the like uh give me the whole environment, the year, when the light bulb came, and kind of how this all was, and what were you guys all doing in your lives when you were like, we're gonna jump right in on this?

SPEAKER_03 9:11

So I had a small chain of retail stores that focused on first vape starting in 2014, I think. We were one of the first vape stores to open in New Orleans. Um, and that industry changed pretty tremendously uh with the advent of the jewel. Uh really, it really went from being a specialty novelty product where you you need some technical assistance to do it properly. If you're starting out and you have these a million choices for the little juice bottles, and then CBD came around and we were buying C BD products from people, and man, they sucked.

SPEAKER_00 9:45

I don't mean to be rude to these people who I was selling and I was selling and had to fire people because they're tasting they they were horrible.

SPEAKER_03 9:52

I mean, they everything from the the professionalism of the organizations to the the products themselves to the the way they were testing just wasn't what we expected. Um and we we met a gentleman, Rob Lind, who's our chief of manufacturing, one of the co-founders, and he was working for a big CBD company and they treated him poorly. And uh and he said he'd be willing to take this this plunge with us and and see how this goes. And we raised, I I've I'm I have a real estate background also. That's you know, I have a property management company and real estate brokerage, I do investing. Um and so this was just this was not supposed to be, I don't want to say this is not this was not supposed to be what I did every single day of my life and all I think about, but that's that's what it's turned into. Um, so we we've gathered a little group of people. Our our uh chief marketing officer uh is one of my good friends and co-owners in the business. And we thought we've had a good team between manufacturing, um management, marketing, and production. So manufacturing production. Yeah. Um so we just we just did it. We we went and we we raised money. We kind of sat around for a while, like, all right, we have a plan here. This actually could work. We we can get CBD at this good price. We we have a number of people who want to buy it from us. Um, and we just did it. We we went out and we raised one day we just sat down. We're like, let's we need it's time to raise money because every day we do this, we think our valuation is going higher and higher and higher. And soon we're gonna have unrealistic expectations for not only us, but the investors. So when we raised uh $430,000, we probably should have just raised $420 in hindsight, just for the story. But um we raised that money. It was definitely not enough to do what we wanted to do, but we made it work and we kind of grinded. And for a few years there, when we were just selling CBD products, we really, you know, initially we saw great growth, and then we sort of flatlined and um, you know, we we were making a little bit of money, but nothing, nothing worth mentioning. And then we started selling the gummies and the flour, and we started actually making a little bit of money. We're like, oh, this there is money to be made in this. As it turns out, as Josh likes to say, people like to get high. Um, so we we went through all that, and you know, really when the beverage thing came out, it was it was just like we want to do something different. We want to do something that we think is sustainable and and harder, that that you know, not everyone can just make in their garage. Uh, and that's and that's why we we went down this road and it's how we wound up where we are today, just just trying things. I mean, Josh was a he'll tell you, he was a sports writer, he was the beat writer for the Saints in New Orleans when this all started.

SPEAKER_00 12:21

So Josh, you got that, you got that editorial journalism mentality. Yeah, yeah.

SPEAKER_01 12:30

Nice, I appreciate it. Yeah, I mean, so you know, I was friends with Joe and you know the other two founders from New Orleans. And uh, you know, I'd been covering the NFL for about nine seasons. I started up in Detroit after college, I was covering the Lions, and then I moved to New Orleans, and my newspaper in June of twenty or May of 2019 got bought out by our competing paper. So I got laid off. And Joe and I were just having lunch one day, and he's like, Well, we could use salespeople. And uh both left. And you know, I had opportunities elsewhere, but I was born in New Orleans, I finally made my way back in 2016. I was not ready to leave, so I gave it a shot, and uh uh, you know, I think before I'd even accepted a job, I went with Joe and a few other guys out to Charlotte for our first production round of C BD. And box party. We were just we were just folding boxes for tinctures, hand applying stickers on C BD cream and freeze rollers, and we were basically just like racing to see who could fold the boxes the quickest. And um, so I very quickly uh learned what goes into this, and at the same time, I quickly believed in CBD because after folding these little boxes all day, our fingers got cut up quite a bit. And we all put on the C BD cream, and the next morning we were all totally fine, ready to box more and cut them again and do the whole thing. So, you know, that firsthand experience definitely helped. Um, but you know, every step of the way we've added people, you know, who have really helped us grow. I mean, at this point now, our sales team has 19 people on it, and most of them come, you know, from a beverage background, you know, all sorts of we've got beer people, we've got spirits people, we've got energy people. And um, you know, every time we hire someone, I'm learning something else from them. And, you know, just to go back quickly to you know what Joe was talking about, the price, like that has been our mindset, you know, on this beverage space from day one, because we saw the way the margins were crazy with CBD, and then they went crazy with the edibles. And, you know, there is already a playbook for beverages. So we thought if we use that playbook, we we can make something that is affordable and approachable because there are people who use cannabis every single day. There are people who use alcohol every single day. So we thought if we could be at the right price, that people could make this an everyday product. You know, they could use it instead of the cannabis products they were using, they could use it instead of the alcohol products they were using. And, you know, it really has taken shape like that. You know, it helps that they taste really good. Um, obviously we're best, but I mean, I've tried a ton of drinks, and there are very few that I would, you know, really consider drinking uh instead of a crescent nine. Um, it turns out a lot of people agreed with us, and we're seeing that, you know, with her sales and you know, with her growth.

SPEAKER_00 15:38

Let's shift a little bit out of the story base and let's talk about the legislation. Um, let's talk about exactly so we have the the we this is we're in here to talk about also what's regulate, don't ruin, and see. We kind of established her story, everybody can connect with that type of a story. Now I want to know how this has affected your lives currently, and then how what you kind of see and what you're doing to to ch make that and affect that change moving forward.

SPEAKER_03 16:04

Well, I don't sleep anymore. That's fun. Uh yeah, this is the most stressful thing I've ever experienced professionally in my entire life. And I flipped houses, which is a nightmare at times, at retail stores, you know, dealt with a lot of things, and this is this is the worst. It's the unpredictability of it is impossible to deal with. There's no no one has any idea what or when something is gonna get done. The people that we work with are like I know, you know, it's cliche, but we're most a lot of us at least are really close. Like we hang out on the weekends, we we hang out after work, we have a good time at the office, we enjoy each other's company. And the idea that this is all gonna end because some octogenarian senator bullied by the alcohol industry in Kentucky doesn't like it is absolutely insane to me. It it boggles my mind that in a country that values freedom and and personal responsibility, that our government didn't even have a vote on this issue. This was just slipped into a piece of legislation that had nothing to do with this. And as a result, hundreds of thousands of jobs are at stake. The the the products that people in some cases rely on and in more cases love are gonna just gonna be gone overnight. And they're gonna be replaced with what? Black market options, go into dispensaries in Louisiana where people are still charging $45 an eighth for subpar flour, $80 for a half gram pen. That's that's the solution that our government has come up with here is to is to complete to ban a year in advance with a with a year window, without, and and we haven't even had real conversations about this yet on the hill. We can't even get these bills or these amendments in front of committees to discuss them. They're just pulled before they even have an opportunity. And we talk to people who like you know, um Representative Barr, who, you know, for future Senator Barr, most likely. And and these guys are all great. I mean, I have no I have no qualms with them, but it is very challenging when you're relying on somebody who is focused on so many other things to save your industry and save your jobs and save, you know, this this whole brand new category that people obviously love. I mean, look, if nobody was buying this stuff, we wouldn't be talking about this. But it is extremely popular and it's growing as fast as any beverage category in the country right now. So the idea that this is all just gonna disappear without even being discussed in Congress is mind-boggling to me. And frankly, it makes me lose faith in this country. It really does. I I have no faith in the government right now. And I I think most people would agree. But when you've when you've been when you've gotten a crash course like we have in this, and how dysfunctional and how honestly corrupt all of this is, it is disgusting. And it's it's a travesty that that they're just gonna destroy all of this for no reason whatsoever, other than the greed of people with deep pockets. And I don't know what to say. I wake up every day and I don't know what to say. What are we supposed to do? Are we supposed to fire everybody? Are we supposed to go and and and continue producing product? Now everyone's talking about how, oh, well, you know, September 30th, that's what that's when we really might have something. September 30th, that means that six weeks after that, seven weeks after that, we have to have more we either have a company or we don't. Like, how how are you supposed to function in that environment? How how are we supposed to make decisions about how are we supposed to make supposed to make decisions about what to what to produce or who to keep on? How are farmers supposed to decide what to put in the ground? Because you don't just put it in the ground and oh, you have a hemp plant and it's processed. Like this stuff takes time. And it's it's it's just disgusting to me. It it honestly is I I can't even, I'm not even, this isn't even hyperbole. It's like ruining my life. And I and I can't understand why it's happening. And I I can't understand how we can't get straight answers from anybody in Congress about what they actually think about this.

SPEAKER_00 20:07

Joe, I want to thank you for giving like this. I'm with you in this because in the past couple years, uh, I got sober three and a half years ago from alcohol and opiates, and hemp beverages saved my life. Um, I tried to get sober five or six times over the years, and it never worked. And because nothing was good. Um, you know, all it was was O'Dules or any other non-alcoholic beer to transition myself. And I worked in the beer industry, and so it was accepted to be drinking all day long at 8 a.m., 9 a.m., 10 a.m. And hemp beverages gave me a bridge that I needed to get sober, and I've been three and a half years sober and four years in December coming up. But congratulations. Thanks, guys. But the reason I say that is because uh while I reorganized my business, because when this happened and I saw how how good this stuff was from a medicinal standpoint as well as a recreational standpoint, I went full board. Uh, this podcast is something I do on the side. It's uh most of our my job is I'm on the road and selling products for different brands into retail and building market development into new areas. Um my skill set has always been cold opens in business development, and that's what I do uh around the Mid Atlantic for certain brands in the space in the functional space. Um, so my place is a passion, a place of passion more than it is about money. I never did this to make the almighty dollar. I did it because I believe there's lots of people like me that need this stuff. And then I also believe there's a lot of people like me that also recreationally need this stuff. And so I'm with you 100%, and I really want to thank you for being so honest because I ask that question a lot in here, and a lot of people hold back. Um, and I feel exactly the same way you do, and I'm sure obviously Josh feels exactly the same way as well. The fact that in America, in a place of I'm a I'm a libertarian of the old libertarian, not the new perverted version that exists today that's can be corrupted at any means by the biggest check, because that's the biggest bullshit that exists. Is the fact that do you want to say you're a libertarian, you want to say you believe in free enterprise, and you want to say you believe in the American dreams. Uh, but if somebody slides you a check, and I'm speaking from the fact that I call this up the big three, the big You know, the big three beers and all the pharma and all that stuff. I walked in into the hill with the HPA as well. And guess what they told me? Uh yesterday Ann Azur Bush was in right before you telling me you're gonna lie to me. You know, and it's one of those things where it's like, I I I don't have a lot of faith in things either, but at the same time, I have a lot of faith in pressure. So, what I want to say to you is, and I want to say to Josh and everybody that's listening, is what makes these guys scared is these guys are these guys, let me just let me not offend any politicians or lawmakers and say this the right way.

SPEAKER_03 22:30

Oh, I think you should offend them.

SPEAKER_00 22:32

Alright, cool. So, just as much as that million dollar check, because Pennsylvania, for example, we're doing a campaign across Pennsylvania, and I can see how much lobbying dollars are coming in. I'm working with a couple thousand dollars and a ton of my pro bono hours in Pennsylvania to get this product on the shelves in bars and restaurants, because we can only sell it in vape shops and things like that, which we all know is a viable channel to be there, but it's not as viable as the regular point of purchase where these consumers are, which is liquor and alcohol establishments. So we have a bill that we're trying to get done with that, and our opposition's spending millions of dollars against it. And we have a couple thousand dollars maybe to do. So we're we're squeezing everything here and there. And I think that what people need to understand is, and I hope the audience listens, is that text message, that phone call, that email to your local lawmaker to tell them to wake the fuck up, that's now. And that's how you can help these guys, and that's how you can help all of us because I'm I'm not sitting here from the outside laughing. Like, I'm a solopreneur for the last 18 years. I started my business in 2008 to service uh beverage industry brands and help them navigate the wholesale world. And I've reestablished my business in the years for this industry. Um, and it is a big hit for everybody. And with for some of us, like you guys as well, we're all just still coming out of COVID. You know what I mean? We're not we're not exactly coming out with a full bank account into this, and also with the access to capital and the insurance issues and all that, we're not in a place like Craft Beer was in 2010 to 2015 where you could go to the bank and get a loan for a t-shirt to dream out of a garage. And and that's something that really, you know, when you said 400,000, I mean that's to some people when you might say, oh my God, that's a lot. It's not really a lot because a lot of these brands to start at the scale that you need to start at, you need a million dollars in the bank. And getting them a million dollars is not easily done in private funding. And so I want to commend you guys for what you're doing, and I also want to commend you guys for your grit and your resilience, because despite the fact that what you're saying, you still haven't stopped. You're on this call right now, you're you're doing the right things, you're joining the campaigns that need to be joined, because that's what needs to happen. And to the audience, I'll go back to what I originally wanted to say. What can you do? Paychecks matter to these law lawmakers. Getting paychecks from different organizations, lobbying groups, things like that, they care about that. But the number one thing to scare the shit out of them is to have constituents and local businesses putting pressure on them. Because that is free, and that is a little bit of your time, whether it's five minutes for an email or a phone call, and that is where it really puts pressure on them. And right now, what we're hearing from these con this Congress and senators and things like that is they're just not hearing enough from the constituents and from the local businesses. So that's my that's my challenge, and I'm sure you guys would agree, as well as some other add-ons as well to that.

SPEAKER_03 24:59

So I'll I'll tell you the most that what happened to us a few years ago in Louisiana is that we we faced an existential threat um from the most powerful lawmakers, the richest people, and we we were told we were dead. They wanted a gun and it was gone. And we said, okay, well, that's great and all, but we're not we're obviously gonna fight to protect our our biggest and our home market where we spent you know millions of dollars and people love these products. Um so we we went to the people and we organized the biggest grassroots, phone-in, email, call, everything that that this state has seen in a in a very long time. This is the same session down here that we they they made the abortion pill a felony, uh, and they also were going to have a constitutional convention. They received twice as many phone calls and emails about our issue than they did those two issues combined. They were the phones were ringing off the hook. And by the time that it came to vote on this issue, the politicians were legitimately scared. And they should be, and they should have been, because their constituents from a ratio of 99 to 1 were getting phone calls saying, what are you guys doing? Why would you ban these products? We love these things, we use them every day. And they weren't just getting them from like young 22-year-old hipsters, you know, doing their thing on a street corner at 9 a.m. They were hearing from middle-aged white women and people of color and grandmothers, and they were all saying the same thing. They're like, why would you get rid of this? It doesn't make any sense. There are companies here that make money doing this. There are people who employ people who live in this state. And not only that, but I love these products and I use them every day and I don't want to stop. I don't want to become a criminal just because some rich politician and or or ally of a politician is threatened that that someone else came out with a product that's taking a little bit of their market share. Um, and we won. You know, it wasn't a clean win. We got we were limited to five milligrams per 12-ounce can. You can only do four packs, but that was a win for us. We survived when everyone said we were dead. And they they said there isn't even the the politics, the people in politics that I trust told me there isn't even a point in fighting this. It's done. The governor wants it done, the lieutenant governor wants it done, the Senate president wants it done, Speaker of the House wants it done, the the richest guy in Louisiana wants it done, the the marijuana industry who's funded by a billionaire down here wants it done. And we're like, cool, well, the people don't want it. And that's that's who actually, that's who these people actually work for is the people. So to your point, man, you're right. That's what has to happen. And the reason this didn't, the reason this was able to sneak through, I mean, I'll give Mitch McConnell credit. I I think he's a uh a piece of shit. Let's be clear. I don't want to mince words. That is that is how I feel about him. And I feel even more so today than I did yesterday, and I'll feel more so tomorrow than I do today. But he tried to sneak in hemp legislation so many times leading up to the continuing resolution that wound up with the ban, that this became a boy who cried wolf scenario for our industry. We all came out four times that year. Urgent, emergency, contact your representatives. By the time it actually came down to it, by the time it was put into this bill, everyone had heard from us 10 times, not 10, literally four times that year, that the end was happening if you don't pick up your phone and nobody called. And there was no oxygen in the room at that point, too, because we were talking about the about about uh food stamps and government employees getting paid and funding the military. And yeah, those issues are more important than hemp for the national conversation. I get it. But we didn't have a room to breathe at that point, and nobody picked up the phone to call about that one issue. And the phones were already ringing off the hook from people who weren't getting paid and people who needed food. And like I get I get why it worked. And he's a savvy McConnell's a savvy politician. I'll give him that. But that's why this, that's why this happened. That's why this was able to get in that in that bill that had, again, nothing to do with hemp otherwise. And and again, to my point, we still haven't had a conversation about this nationally. It's never been talked about with any sort of detail in Congress. Most people, most Congress people probably barely know about this issue still. And and it has to change. I mean, and and the question is now, where where do we go from here? When, when do we have this conversation? Because we've been told a patient, you know, oh, let's let's let the dust settle, let's figure it out, let's let's have the marijuana, the the hemp folks who are selling flour, you know, let's have them realize that this this is not, this is gone, you know. We're on the beverage side, right? I don't really care about flour. I think from a personal level, sure. What I love for flour to legal, yes. Do I think it should be? Yes. Am I gonna die on that hill? No. If I'm told a compromise is a is a beverage bill, then that's what we're gonna support. And that's what we'd heard a few months ago. Now, when you look at the legislation that's out there, it's not a beverage bill anymore. It still is this all-encompassing huge piece of granite. And we're told that, oh, well, you know, when it goes through committees, we're gonna turn it into a beautiful sculpture and it's gonna get something through. I'm like, let's can we just have an honest conversation about hemp beverages in this country? Because hemp beverages enjoy popularity that a lot of other hemp products don't. Like they appeal to a much wider demographic and gummies too, to some extent. Um, but you can't you can't find issues. Go on, go on Google News, type in hemp, hemp beverage, and find one article that shows something negative that's that's happened in the long term here. Show me that drunk driving accidents are up. Show me that, you know, not drunk driving, I'm sorry, impaired accidents are up. It's the opposite when you look at Colorado and they legalize. Show me that this industry is is is breaking all these rules that they love to throw out there. Show me that we're actually selling to kids who are under 21. Because I don't know anyone who sells to kids under 21 in any portion of this industry. Even before the laws became that in a lot of states, nobody was selling to under 21 kids. Or under 18 in most cases, but you know, the the industry is self-policing. And to your libertarian point, like the industry's done a really good job of weeding out most of the bad actors here. People still like to pretend like that we're this brand new industry, and oh, the war the sky's gonna fall. Cannabis has been being used in this country for generations now, and guess what? We're still here. Everyone's still doing fine. And if you can't buy it from the grocery store, you're gonna go buy it from a drug dealer. And how does that benefit anybody?

SPEAKER_00 31:20

It's uh it's one of those things too, where I saw this week a new report that uh that you know, they're finally coming out with reports that, you know, I I I worked in the alcohol industry my whole life, so I'm not saying this is a dig on them, but also at the same time to pretend that alcohol is not a debilitating thing and it's not easily comparable to this is just really asinine. And the fact that this new report comes out this week that more than one uh drink or cocktail a day is uh is unhealthy for you, and then it turns out that the government was suppressing that release uh until this week. So the fact that also manipulation, mini narrative manipulation. So again, Josh, back to my PR degree here, get dust off the academic world, is that the counter-narrative is not being published because the algorithm is suppressing it also. The amount of times where I'm putting up factual information and and Joe, to your to your point, I just was interviewing um the council for advertising for cannabis, and that was exactly what we talked about. We talked about the disinformation tax that exists, where it costs five times as much for you for us to get your story out there, it costs five times as much as if I was to work with a distillery client. That's wrong. And that's not wrong because the distillery client's doing something wrong. It's wrong between the way the platform and the structures and the way we get messages out are put out there. And the other piece is you are right. There are zero, and this is from the Hemp Beverage Alliance directly, zero beverage instances with the children's safety that goes on. And I use children's safety because I'm also gonna be stern is if you actually gave a shit about the kids and you thought it was that big of a deal, you would have banned it at midnight in November. You wouldn't have waited till the following November. So that's the other thing. Why would you care about the children and then leave it for a year to run rampant? Where honestly, if you even believe how people would do, they would just sell as much as they can in the next year. Well, what you just did was if you cared about the kids, was you just flooded the market with product that people just want to get out of their warehouses. Yeah. I mean, like and also to answer your point to answer your point too. Yeah, yeah, exactly. To answer your point too, some degree. To answer your 20 uh point of the 21 over as well, is the products that's being consumed by those children in those instances with the gummies and the flour, it's being consumed because the parents have left it out in their house. It's not they're not buying it from a store and then and then getting it, because when where you would know is is in that story where that child and that thing's happening, they would be showing where it came from because they would be exploiting the place where the child purchased it, but they can't legally put that in the news because it's not the way it is. It's the child found the bag on the kitchen table and they took it from their parents. Just like, and the reason I want to say this, and Josh, I'll let you go in a sec, is that it's just the same as if you left your bottle of tequila in the middle of your kitchen and your kid drank it and got in and and now alcohol poisoning. Like, so what are we gonna ban tequila?

SPEAKER_03 33:58

Well, tequila is an interesting one, but it's really a lot of these, you know, these lower lower ABV products that taste great. Like the kids probably not, I don't want to defend tequila, but I mean I do, I love tequila, but uh you know, a kid's probably not gonna drink a five-year-old's not gonna drink a bunch of tequila for the most part. It doesn't taste good. But a lot of these other products that you know, we're told, oh, child safety is a big thing. Okay, cool. Why do why is every single alcohol manufacturer allowed to put cartoon characters and well and hard welds and yeah, hard weldings, hard Arizona? Yeah, like are you kidding me here? It's it's it's just a joke.

SPEAKER_01 34:35

Well no, what I well, I was gonna say a couple things. Um, one of my most favorite and least favorite stories, a couple of years ago, the former uh governor of Missouri uh tried to just ban these things, you know, with an executive order. And uh he cited data that said that there has been a an 800% increase in THC uh hospitalizations in children. Missouri has legal marijuana, and they did when this report came out. And it turns out the 800% increase was an increase from one child to eight children. So that's not exactly you know, leading with the truth, and also there's nothing that could say that the those, you know, children who should not have been having these products, obviously, whether they got them from their parents going to a dispensary or from home products, whatever the case may be. Um, but what I was gonna say earlier, you know, it's a very there's a very frustrating paradigm to me because during the early days of the pandemic, you know, everyone was locked down, alcohol sales went crazy because people had nothing better to do than get drunk at home, you know, maybe hang out with a neighbor. Then as soon as you know the restrictions were lifted and people started getting out, a lot of people wanted to lead healthier lives. So alcohol sales started to decline. Our products did not exist, these hemp beverages did not exist at that time in 2021. So alcohol sales already going down, then hemp sales hemp beverages come out a year or two later. And they are saying that our drinks are the reason that alcohol sales are down when in fact that trend had already started. And if you ban MP products, people who drink them are not going to immediately go back to alcohol. They are going to, as Joe said, find a drug dealer, they'll go to a dispensary in a legal state and buy these products and stock up, and they are just not going to all of a sudden shoot the alcohol sales back up to where they were before the pandemic. So, you know, I think, and then the other frustrating thing, you know, Mitch McConnell in particular, Kentucky grows, you know, nearly as much hemp as any state. So we got to see Mitch McConnell slide this law change in there while Rand Paul is fighting on behalf of the hemp farmers. We now have uh Andy Barr fighting on behalf of the hemp farmers, and it's like this is not really benefiting people. It is not benefiting farmers, it is not benefiting consumers, it certainly is not benefiting small businesses. And there are so many people with stories like yours, Nate. You know, I have people all the time like, what's been the you know best part of this experience? And it sounds so so cliche, but I've had so many people tell me that our products have changed their lives. You know, there's uh a liquor store that we love here in New Orleans, and one of the managers, I think, had liver surgery a few years ago. So he works at an amazing liquor store, he cannot drink alcohol, and he loves THC beverages. And there's so many different stories like that, whether it's people getting off of alcohol, pills, other drugs, you know, switching to this, whether, you know, that like there's all sorts of reasons. And you know, we want those people to continue leading what they believe is a healthier life now. And if these go away, you know, it like from our standpoint, you know, we have, I think, a little over 40 employees. So all of those people would, you know, need to find new jobs. But there are just millions more people who would be negatively affected by this. And there's a very small subset of people who would actually benefit from these products going away. You know, the the federal government accidentally legalized THC. But what we've seen is the world has kept moving on. If anything, it has gotten a little bit better. You know, one of my favorite things to repeat, you know, to distributor meetings is that bartenders love when people drink THC drinks because they are much nicer to the staff than the people who are drinking, you know, the same amount of alcohol. And, you know, we just, you know, would love to continue doing this and building this. And, you know, we you know continue to say that there are so many people who have not tried these products, and that's why we expect to continue growing. And we would just like the opportunity to do that and continue to do it in the professional way that we do because I think Joe used to say all the time, you know, our products are tested more than baby food in some cases. So, you know, we we think that our products are safe for 21 plus adults, and you know, we hope that the government, you know, will realize that here in short order.

SPEAKER_03 39:09

I don't think there's anything in a grocery store tested more than our products. I literally I don't think there's tested.

SPEAKER_00 39:14

Tell people all the time, like when I'm doing tastings and stuff like that, it's the most transparent product on the shelf, period. Like every we're going into a society where everybody wants to know what's going in their mouth. You can't figure out on half the RTD, let's take a take the keel out of it and put an RTD vodka can in there. There's no nutrition label on that. There's no calorie count. I put on a hundred pounds selling craft beer for 10 years because we didn't realize we were drinking three, four hundred calorie beers all day long. You know, like sitting in there drinking all the bar food and everything like that. You know, it's not there, this is literally the most transparent adult beverage on the shelf. And the fact that it's being is being put into a negative aspect of being dangerous is the biggest irony of the world, is that we're not doing enough education. Not we as individuals, but at scale. We're not educating consumers enough, we're not educating people enough, but also the corruption is is a big piece of it, Joe.

SPEAKER_01 40:05

You know, one of the things that, you know, in the face of this ban has just continued to give me optimism, is that they gave it a year. So if it was truly this public health emergency, they would have banned it that day. So, you know, we continue to hear that, you know, the White House is engaged on this. They are hoping, you know, to continue allowing full spectrum CBD products in some manner. Hopefully that, you know, gives us uh space. But you know, we're gonna keep fighting and and see what we can do.

SPEAKER_02 40:37

Yeah, I mean, I would just say this isn't the first time that we as a company have been told we're dead.

SPEAKER_03 40:43

And as little faith as I have in the American political system right now, I do have faith in Americans. And I think that when it becomes apparent to everybody that this is not a drill, this is really happening, that they are gonna pick up the phones, they are gonna call their representatives that they know, and they are going to make their voices heard. And loud and clear, everyone who's ever cared about this issue, like really cared, not been told by somebody else to care. Anyone who actually cares about this is in favor of it. And, you know, there are there are a lot of us. There are many more of us than they think. And I think and and when politicians start getting word and wind of how angry we are about something that they that they generally don't care about, they're gonna they're gonna flip. The question is when does that happen? Is it in September? Is it in the lame duck because everyone is paying lip service to McConnell? Oh, thanks for being this guy for 30 years. We're not gonna go against you. Or is it and does it wind up being in the news session? And if it's in the news session, when does it start? How does it go? Uh, it's hard for us because you know, we're gonna have product when this is all said and done. We're not, it's impossible to sell through everything on that exact date. And if uh and if the ban is extended, or I'm sorry, if the moratorium is extended or if new legislation comes, you have to be prepared because you built this company that that and and that other companies rely on. You know, we're in 10,000 or so stores. Um, those those stores are not just gonna sit hold our shelf place until we get production back on track. And three months later we'll be like, all right, cool. Here are our six SKUs. They're gonna move on and they're gonna they're gonna sell to people who have these products. So if this does if something does get done in September, does it all of a sudden require for all these products to have a sticker on or to have a little label that says FDA approved or, you know, made in the USA? Like, and if so, what do we do with this old product? We have to go and sticker everything again. I don't, I mean, you're in the industry. Do you realize? I don't think anyone realizes how much time and money and resources are spent putting stickers that nobody reads on cans because some legislature decided, oh, this one needs to say, like Minnesota, it needs to say this product may not be legal outside of Minnesota. Like, what? Nobody's reading 900 little words on the side of a can. The idea that our product can't be sold there because it doesn't say this product might not be legal in Minnesota. It's just some stupid politician with some dumb idea that for some reason all the other politicians agree with. I mean, it's it's it's astounding how much time we spent putting stickers on boxes and cans to comply with some legal requirement that makes no sense whatsoever. It's I'm ready. I'm ready for national rules. We all are. Like we just want to know what we're doing here. We don't want to have to do one thing for one state, one thing for another state.

SPEAKER_01 43:38

My favorite of those regulations that forced uh some stickering is that in Florida, you have to have an expiration date. It cannot be a Best Buy date. It cannot be a born-on date, it has to be some variation of the word aspiration. And so I think we used to say best buy date and made our products briefly illegal in Florida. And you know, ultimately, like Joe's saying, we just want to know what's happening. And we would be perfectly fine if there is a five milligram beverage limit. If that is the new regulation, because you know, we we've already gone through this with alcohol after prohibition. You know, at the time it was just three, two beer. Now you can in Louisiana, you can buy Everclear at a gas station, you know. So, you know, we would hope that you know, if we get the opportunity to sell anything, that we will show, you know, that everything we're saying here is true about the safety and the you know interest in these products. And then once we prove that, then it can grow and people can get, you know, the 10 milligrams down the road or even even a little something stronger, edibles, flour, whatever the case may be. Because, you know, out of all the stories of all the positive feedback that we've gotten about how people are using this and why and how it's reshaping their lives, I can only think of one or two negative stories. And that's going across the millions of products that we sold.

SPEAKER_00 45:05

It's it's something that's that's uh I I'm gonna I'm gonna pick on the hypocrisy of those laws too, where you know, to say like, oh, this isn't legal in another state, we ignore what you just brought up. A great point is with alcohol. People we we casually will go like to another state to buy some product because it's not available in the other state, and then called transshipping, where we will take something over a state line and transship alcohol, but it's it's not it's so normalized because it's happened for so long. It's the same concept. So the more we get our heads out of our asses and put hemp beverages in the same line that we do with alcohol, the more everything makes sense. And I think I agree with you as well with the with the gummies and the flour. I'm just gonna say it. They need to just take a back seat and allow the car the path to be carved with beverages and rest easy on the fact that somebody has to take it first, and all three categories are not moving forward at state levels, at federal levels, period. Like the only way anybody's moving forward is a beverage bill moving forward to pass to carve that way.

SPEAKER_03 46:03

If you live in North Carolina and you want jobs to remain there, businesses to keep growing there, and you want the freedom to go and consume what you want without the government telling you what's safe and what's not, regulate, don't ruin.

SPEAKER_01 46:14

If you've ever enjoyed a hemp product and want the freedom to make the choices that American adults should be able to make, regulate don'truin.com.

SPEAKER_00 46:24

And I appreciate you guys coming on and having the cojones to do that. And also it showed because you have the cojones to fight whatever fight you got in your challenge. So coming on a podcast for an app easy compared to what you guys are fighting every day. So I want to thank you guys for doing that. Thank you guys for participating in this campaign. And as we're kind of rolling out here, I want everybody in the audience to remember as much as this is advocacy, education, and ROI for these businesses to be able to show you guys what's going on, tell you these stories. It's also about human connection. Josh and Joe and I have never met before in our entire lives. We've never shared a coffee together, never shared a drink together at a bar or anything like that. This is a human connection. And in 2026, human connection is the most important, most valuable thing that we have. So while you're walking down the street, put your phone in your pocket, look a stranger in the eye and smile at them. I challenge everybody every week. Five minutes of kindness to a stranger, 20 minutes of kindness to strangers every month. You're at the gas station filling up that cup of coffee, look at the person next to you, ask them how they're doing, shut your mouth, and listen to their story because there's a lot of things going on where our lives might feel cool, and we might have a lot of people in our lives that care about us, but there's a lot of people here that are lonely in this world. And there's a lot of people that that one piece of human connection could save their day, their week, their month, and God forbid they wanted to exit this earth, it could save their life. And it sounds so minuscule in the grand scheme of things, but it is so important, guys. So five minutes a week to be kind to a stranger and connect with human beings, people out there. Everybody, regulate the rural and nc.com, support Crescent Canada, support George, order DTC if you're not in a state where you have the product available on your shelves, get that product, go to their websites, support these guys out there. Josh and Joe, I want to thank you so much for the time today and coming on here and fighting the good fight.

SPEAKER_02 48:01

Thanks for having us, and thanks for bringing so much attention to this issue and uh doing your part to keep us alive. Thank you, Nate.

SPEAKER_01 48:09

We really appreciate what you're doing.