This interview was recorded on June 25 at the MJ Link Micro Investor event in New York.
GMR Editor Debra Borchardt: Okay. Cannabis beverages are expected to be the next big thing in the industry. Joining me now is Province Brand’s CEO Dooma Wendschuh. We’ve heard so much about these beverages and your company is unique in that the beverages that you’re making are using literally every part of the hemp plant, correct?
Province Brands CEO Dooma Wendschuh: We do make one beverage that uses every part of the hemp plant, but what makes it really cool, I think are most of the beverages we make are actually using every part of the marijuana plant, so they intoxicate using marijuana in place of alcohol. We have a diverse array of product offerings that we’re coming to market with. The one made from hemp, we keep the alcohol it and it intoxicants using the alcohol that comes from fermenting the hemp plant. The others are actually made from stock stems and roots of the marijuana plant, which is a waste material. It’s material that you can’t really throw in the garbage in Canada because it’s a controlled substance. You sure can’t incinerate it because you create marijuana smoke, you get the whole neighborhood high, nobody wants that.
And so there’s this industry of licensed disposal companies that will dispose of this material for a fee anywhere from $20,000 to $150,000 a month that the growers are paying to dispose of this waste. We collect it and actually use it as a starting material for brewing our beer. It’s part of what we call the circular economy. You’re called the Green Market Report. I assume green means marijuana, but there’s another meaning of green, which is protecting the environment and we’re actually keeping this material from the landfill, preventing all the carbon emissions associated with that and turn it into a premium beer that has a fantastic flavor and intoxicates using marijuana in place of alcohol.
Borchardt: So when do you think these products especially are going to be available in Canada? Because we know that this type of product was not available in the beginning stages of the recreational legal market, and I’m hearing that it’s really going to be pushed even further back towards the end of this year. Is that correct?
Dooma Wendschuh: Well, just in the second week of June, we received the regulations from Health Canada for marijuana edibles and beverages and those regulations state that on October 17th of 2019, anyone who wants to make an edible or a beverage, including us, of course, can to have that beverage sold throughout Canada. There’s about a 60-day approval process that they anticipate, could be a little longer for some people, won’t be shorter than that. So the earliest you’ll see a beverage for sale in Canada, marijuana beverage would be December 17th of 2019. So most of the companies are expecting early 2020 to really begin selling in earnest.
Borchardt: We’re seeing a trend now of on the alcohol side, people wanting nonalcoholic drinks. This whole sober trend of wanting to be able to drink, but not getting drunk. Do you feel that your product kind of fits in there because people are not, other than the hemp beer, people are not really getting those alcoholic effects?
Dooma Wendschuh: That is correct. And right now people are drinking less per capita in the developed world than ever before. And what we’re seeing is the millennials are drinking a lot less. Consumers want a healthier alternative, but the healthier alternatives to alcohol, they’re just not any fun, right? You can go buy a bottle of Seedlip, are you familiar with Seedlip?
It’s a non-alcoholic gin that’s just selling like gangbusters. I mean, it’s a huge, huge phenomenon, but it’s just flavored water and it’s a $60 bottle of flavored water, right? With our product, it’s a way that you can go to the barbecue, you can go to your friend’s house and have a beer and they can be drinking alcohol and you can still be intoxicated and have a fantastic time, but you don’t have to feel like you’re missing out and you don’t have to take an all those calories either, right?
A typical alcohol beer is very caloric. Ours are much, much lower, about 40 calories in a single bottle. You don’t have to take in gluten, right? When you drink alcohol and beer, it’s made some barley, there’s always gluten in it. In our product, there is no gluten and you can still be intoxicated. You can still have a wonderful night, enjoy time out with your friends, celebrate special occasions. And there is something about alcohol that you don’t normally get from marijuana, right? It’s not the same to be intoxicated using marijuana as it is to be intoxicated using alcohol. We are working on ways to make our beverage feel as much like that intoxication you get from alcohol as possible so you don’t have to feel like you’re missing out, right?
I understand there’s a sober culture. We’re not making products for sober people. We’re making products for people who want to enjoy special moments with friends, who want to have a psychoactive experience responsibly and don’t want to do it in a way that exposes them to eight different types of cancer and liver disease and heart failure and depression, obesity, all the myriad problems that are associated with our society’s use of alcohol.
Borchardt: You mentioned roots and I’m hearing more and more about the benefits of the roots section of the plant, something that you kind of mentioned people have walked away from or just thrown away. What is it about the root that is so important?
Dooma Wendschuh: There’s a lot of research on this showing recently that some of these phytocannabinoids that were thought not to be very abundant outside of the flower and are a bit more abundant in the roots of the plant. This is helpful for us because we are able to get our phytocannabinoids from the stock stems and roots of the plant, right? We don’t use the flower, we don’t really use the trim to make our own branded products. We’re using those parts of the plant and in this material, this is very little phytocannabinoids, but we use a lot of it to brew our beer. So the little amount adds up and we’re able to get six and a half milligrams of THC in each beer.
Borchardt: Oh, that’s fantastic. So I’ve got to ask you, how does it taste?
Dooma Wendschuh: The flavor of beer comes from primarily these esters that are produced when the yeast digests the sugar that is produced when you mash barley, right? Beer is typically made from barley. Sometimes they make it from rice, some people make it from sorghum, but it’s always some kind of starch, right? And you heat that starch, you create sugars when you heat it and the yeast digests those sugars and that is the number one flavor in a beer. And of course, we have that flavor because we’re turning the cannabis into sugar. And then the yeast is digesting the sugar that comes from the cannabis plant. The secondary flavor in the beer comes from the hops. Now I realize there’s a trend now to making beers without hops, but to me, those are really weird and they don’t taste like a beer at all. But assuming your beer has hops, that’s the second note that you pick up is this flavor of the hops.
And the third flavor is the flavor of the barley. And of course, we have the flavor. Our ingredients are cannabis, hops, water, and yeast, that’s it. We have the flavor that you get from the esters because the yeast will digest the sugars and create those same beautiful beer flavors. And we have the flavor from hops because we use premium hops in all of our beer. We don’t have the flavor of the barley, but what it’s replaced with is this equally complex flavor of the cannabis.
It just tastes amazing. Tastes sort of familiar, but also kind of new. People love it. It’s dry. It’s a lot less sweet than a typical beer because when you do that fermentation to make a beer, the yeast is not going to eat all the sugar that’s produced when you mash your barley.
So beer always has some residual sugar, but because of our process, we end up with so much less residual sugar than they would have in a typical beer. And that’s part of the reason why it’s much lower calories.
Borchardt: And what’s your favorite?
Dooma Wendschuh: Right now, my favorite is a product called Dagga and Imperial. And it’s actually made from cannabis stock stems and roots. And it’s … we’re calling it a Canadian cannabis lager, right? Because it’s sort of a lager style, even though it’s not really a pilsner, it’s something new. We’re creating in a new category and we can name it however we like.