Plexus Cybermedia recently had the opportunity to interview Adam Berk, the current CEO of Stem Holdings (CSE: STEM, OTCQB: STMH), and we have the exclusive exchange for you. Berk’s natural charisma and enthusiasm around Stem Holdings and its current initiatives leaves an impact on those who meet him. With recent milestones in Oklahoma, the acquisition of Yerba Buena cannabis cultivators and additional initiatives on the horizon. Stem Holdings is developing a dynamic and exciting business model.
Thanks for taking the time to chat with us today, Adam. Can you briefly touch on your past work experience and how it has led to Stem Holdings and the cannabis industry?
After graduating from The Hotel School at Cornell University, I founded the first patented online food ordering company, which was originally called OSMIO and is now known as GrubHub. As co-CEO, I learned early on that it’s difficult to build markets from the ground up, but determination and building a great team pushes you toward success.
In my past management experience, we always had the philosophy of the 4 P’s: People, Planet and Practices, will equal Prosperity. I have taken those pillars and implemented them in both Stem Holdings and TJ’s Gardens.
Can you expand a bit about the impact that this mantra has had on your team’s corporate culture?
Sure, let’s walk through an example with our cultivation brand, TJ’S Gardens. With the first pillar, Stem invests heavily in our people, paying them a proper wage and giving them the tools they need to succeed. Our goal is to ultimately help to build a family type work culture. When you see your work family more than your home family you want to make sure there is a strong culture. Our second pillar is: planet. TJ’s Gardens is a sustainable company focused on being environmentally conscious and responsible. We grow our plants using no till live soil, everything is organic and we make our own amendments. This value on “planet” differentiates our growing technique from the market. Our third pillar is: Practices. Stem Holdings along with TJ’s Gardens focuses on integrity, innovation, accountability and consistent hard work. Everyone is accountable in our organization, which means everyone shares our successes. Together, these 3 pillars (people, planet, practices) combine to create the fourth -- which is prosperity. To me and to Stem Holdings, prosperity means profitability. Having an impact on the bottom line allows us to provide great results for our shareholders. It also gives us the ability to reinvest in our communities, employees and customers.
What is unique about the Stem Holdings business model today? Perhaps you can you elaborate on the company’s decision to be involved in all aspects of the industry -- including cultivation?
Absolutely, for us it’s really about having control over every segment of the product from seed to sale. Stem Holdings is now a completely vertically integrated company, as demonstrated by our current model in Oregon. Initially, we start with the acquisition of the real estate. Our team has expertise with building high-end indoor cultivation and greenhouse facilities on land owned by the company. The Stem Holdings philosophy has always been to own the places that we are building on, because why would you make the investment only to lease or rent the property? This is a major component of our business model.
Then we then actually generate our own living soil for our plants to grow in. We cultivate, dry, cure and hand trim our selected cannabis plants. In particular, our cultivators pay close attention to detail at every step of the process. Cultivation is a key part in producing high-quality cannabis products for our customers. In terms of production, we have the expertise to extract cannabis oil using various methods and process the oil into finished goods. This includes products such as; our tincture under our Dosolgy brand, our CBD cartridges, or a Cannavore edibles product.
We then sell our flower, edibles and extracts wholesale to dispensaries throughout the state we are operating and also sell them at our dispensaries. In Oregon, our dispensaries are TJ’s provisions, TJ’s Willamette and are building TJ’s on Powell, as we continue national expansion, our dispensaries will be branded Stem.
What makes TJ’s Gardens a standout brand to you?
Stem and our initial founders became involved with TJ’s Gardens because we were impressed with the history of the company. TJ’s was initially founded by Travis and James. Travis’s wife, Cham, was in a car accident and had a debilitating brain injury. Together, Travis and James used their propriety CBD and THC strain genetics to wean her off of the opioids and to also repair all of her motor functions. Additionally, when we first met the TJ’s team, they were treating 20 adult children with epilepsy for free under their program called the Forest initiative. Today, The Forest initiative has over 250 families in the program.
What Stem Holdings loves about the TJ’s Gardens brand is that they’re conscious from start to finish of the cultivation process. TJ’s has unique genetics and has developed IP with their no till living soil that they make from scratch. As Stem Holdings continues to expand, we will stay true to the TJ’s brand. We’ve made it our mission to bring every part of the iconic TJ’s brand with us as we expand both nationally and internationally.
Where do you see Stem Holdings heading in the future? What is your big picture vision in the cannabis industry?
The Stem team is building the infrastructure to become one of the world’s finest publicly traded cannabis companies. Our focus is on promoting organic cultivation, positive labor practices, environmental stewardship, while providing high quality and consistent products. As we expand throughout the country and globally, we will continue to develop and invest in our products as it relates to THC and CBD. Because of our unique, high quality CBD genetics, we could potentially look to develop a CBD cosmetics line or an organic CBD food business. We see huge upside potential for our company as it relates to CBD and will continue to invest in product developed.
With the recent decision to take your company public, what value are you providing current and future shareholders with Stem Holdings?
We are going to do our best to provide value to our shareholders by demonstrating shareholder returns and exceeding expectations. It’s important to remember that in terms of cannabis, we are just at the infancy of the industry. Some days it can feel like a sprinted marathon -- but the long game is incredibly important here. By implementing our expansion model and constant product development, we will continue to focus on our strategic expansion decisions and timely execution. I think a great example of this is our expansion into the Oklahoma market. Stem Holdings was able to partner with one of the largest real estate and tree farmers in the state. We received 17 licenses: 7 retail, 5 cultivation and 5 processing. We will expand our footprint with swift execution into this market and we will implement all of our iconic brands including TJ’s Gardens, Cannavore, Dosology and supernatural honey.
To read more about Stem operations and facilities, go here.