How did they start their business?
I am Kim Rael, President and CEO of Azuca. My background is in technology and venture capital, but a few years ago, I decided to make a career pivot into the wellness sector. I was unsure of my next move and I was unexpectedly asked by an old friend to be in a focus group to sample a cannabis product from Ron Silver—Azuca’s co-founder and Chief Creative Officer. I was not a cannabis consumer so I was skeptical, actually, truth be told, I was fearful. I trusted my friend and agreed to sample the products and, in a nutshell, they were fantastic. I knew immediately that Ron’s TiME™ Infusion technology, enabling fast-acting cannabis edibles and culinary-forward products, had disruptive potential. As I did my due diligence on the industry and Ron’s technology, it was clear that it was time to reinvent the future of cannabis edibles and solve the “edibles problem” of long latency times and poor quality and predictability, and to demystify the cannabis experience for new adopters like myself.
What were the challenges they met during the process?
One of the toughest challenges has been being a startup company in the startup industry. There is no rulebook or set of norms that you can refer to in this industry. Things that are routine or ‘the usual’ in other sectors, like purchasing business insurance, opening a banking account, securing payroll and merchant services are either more complex and expensive in cannabis than other sectors, or sometimes just impossible. There is also unprecedented volatility in the regulatory environment, from the FDA’s jurisdiction to state and local laws; that coupled with a need for more research adds up to form an extraordinarily complex industry.
How did they manage to cope with the challenges?
Our number one goal is to be helpful to customers, partners and our respective communities. We spend an inordinate amount of time, energy and focus on understanding and complying with the multiple, complex regulatory frameworks that we operate in. We also have a team of talented people and we always look for team members with a strong commitment to compliance and quality, complemented by very high tolerance to ambiguity.
Who inspired them in their journey?
While I was working towards my MBA at Stanford University, I took an entrepreneurship class with Jim Collins, now the author of several acclaimed books on how companies achieve greatness and how successful leaders in the business and social sectors have built movements that last. Jim’s class was transformative and is relevant not only to my current role in the cannabis industry but also to my entire career working with startups. Jim’s recent research and publications have been particularly useful, too, as he’s been working on case studies about how companies have succeeded and failed in times of chaos—and it’s safe to say that a startup industry like cannabis can be pretty chaotic at times! I highly recommend Jim’s book, “Great by Choice” which studies why some organizations thrive in times of great chaos an unpredictability.
I have my personal “4-P’s”:
- People: Surround yourself with a strong team. It is critical to get the right team in place, and not be hesitant to make changes quickly.
- Product: Figure out what sets you apart and lean on it. Companies and brands that define markets differentiate themselves. Consumers, partners, and investors need to understand your product and brand and how you deliver value to everyone your product touches. Be clear and consistent with your message, your brand, and your visual identity across all platforms, including social media, digital, packaging, sales collateral, trade presence, and media. Your brand must be front and center in every communication and application.
- Pace: Stay up to date. This one seems obvious but I think something that a lot of startup founders and entrepreneurs can struggle with is getting swept up in the details of your own company—so much so that you lose focus on industry progress, competition and new applications. Time is a luxury for entrepreneurs and everything is a high priority task, so ‘staying in the know’ often, and mistakenly, gets put on the backburner. Even if it’s just subscribing to one industry newsletter or reading news headlines at the start or end of your day, an ear to industry happenings goes a long way. This is especially important in such a new and burgeoning industry like cannabis where the rules and regulatory framework, and just about everything else, are changing daily.
- Pivot: Evolve your strategy and business model “real-time.” In cannabis, we are pioneers in the most volatile industry of our lifetime. Everything has the potential to change every day. Successful entrepreneurs in this space will have to embrace and absorb new information daily and pivot their business model and strategy accordingly.
I’ve taken cues from my previous careers to build Azuca into the brand that it is today. By leveraging my venture capitalist background, for instance, I am able to approach investment and fundraising conversations with a well-rounded understanding of what investors need to evaluate a new investment. You need to show growth, the potential for expansion and, most of all, why you’re different. What is your company doing that no one else is doing, and why should anyone care? With Azuca, answering that question is easy. Our TiME™ Infusion technology outpaces any other product or brand on the market and will—in fact, it already is—launching the edibles sector into a new era of fast-acting, precisely dosed and culinary-driven products.
What Marketing methods did work?
Marketing is a challenge in the edibles sector as many SEO platforms and social media channels prohibit or place heavy restrictions on advertisements and digital promotions. That said, we have a great product and have been able to rely on grassroots marketing—like word of mouth, media presence, trade show attendance, old-school social media tactics—to get our name out there.
How much did they spend during the startup phase?
We’ve invested several million dollars to launch the company and Azuca brand.
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