Catharine Dockery 0:00
You name the fine a lot of the PMS or the GPS or whatever, they wrote personal checks his company, but they weren’t able to invest out of the fun. And to me that was just like a part of my brand. It was just such a mindfuck, right? I’m like, so you’re allowed to do this, but your investors that you represent can’t get into the deals that you think are great, right? Like what? And I just kept hearing it over and over and over again about this vise clause. And I was like, What the fuck is a vise cause right? Like, what is this that people have money around? So would lots of research and like I would follow up at the interview and be like, hey, like you said one thing that really caught my interest. Can you please find one advice clauses? And I got around a dozen funds to basically tell me what the rights clause said. So I saw that it was it was for cannabis. It was for nicotine or alcohol. It was sex tag, like ketamine, psychedelics like any of the categories that I thought would have explosive growth and exits based on historical performance and they couldn’t invest in.
You’re listening to To be blunt, be podcast for cannabis marketers. We’re your host Shayda Torabi and her guests are trailblazing the path to marketing, educating and professionalizing cannabis light one up and listen up. Here’s your host Shayda Torabi,
Shayda Torabi 1:22
welcome back to the podcast everybody. My name is Shayda Torabi, and I’m so happy you’re tuning in to another episode of To be blunt. If you’ve been listening along Today’s episode is slightly different. And I’ll explain why. I’m so excited to be releasing a previously recorded interview I did with Katherine Dockery, the founding partner of vise ventures, a seed stage venture capital fund conquering stigmas and striving towards superior returns by investing in good companies operating in bad industries. I was asked by the VC summit to interview Catherine about her company and specifically we dove into investing in the cannabis space. One of Catherine’s premier portfolio clients is a nationally recognized CBD sparkling water brand recess. And in our interview, we unpack what seed investing is, why you might or might not need outside funding for your Canna brand, and a few of the craziest business ideas that have come across Katherine’s desk. So without further ado, let’s dive right in and welcome Catherine to the show.
Catharine Dockery 2:31
A lot of startup companies have different rounds of funding. And some of them start with a PC, which usually means before product or before a deck and it’s usually a friends and family around. And then there’s the seed right where you actually have the product, you know, who you’re hopefully selling to, you have some type of product market fit, and you’re ready to go to market. And that’s when we kind of dive in, we work very, very closely with our founders, they help them get anywhere from distribution to figuring out, I don’t know how to say this without putting the company on blast. Like it like an Esports thing, right? Like if you have a problem with that, then like we will also like hold your hand and get you where you want to be and get you hopefully to your series A at least or your Series B.
Shayda Torabi 3:10
So it sounds like you’re specifically we’re in the companies who already have their kind of idea concept and they’re ready to pour some gasoline and grow. Yes.
Unknown Speaker 3:18
Shayda Torabi 3:19
That’s exactly where I want us to dive in. So let’s start with Who are you? How did you get into VC? Why founding vice ventures I want the whole kind of the story behind it.
Catharine Dockery 3:32
So I grew up in the West Village of Manhattan of New York State. My dad was a bartender. So I grew up literally paying three card Monte on the bar and this guy Ernesto who flipped the burgers would take me home and put me to bed that was honestly my childhood. That I went to NYU where I studied a combination of neuroscience and finance. And I worked basically the entire time on the floor of the New York Stock Exchange. I’d loved it honestly one of the best jobs I’ve had to date. And when I was down there, this was when I was still studying neuroscience, I realized that there was a huge connection between the equity markets and why they moved based on human behavior, right. So basically, from there, I decided to write a blog called Dockers daily docket. I woke up at 430 every morning for two years in a row to write it. I was super popular. It’s so many friends. Yeah, so that’s basically my my backstory. My first job out of college was trading high yield debt at Citigroup, which I hate it To be honest, and super sexy. Yeah, I don’t know like some of these jobs that you take out of school you just kind of like learn more about yourself and you do about the asset class, right? So I learned that I was a very sensitive person when it comes to loud noises and people screaming at me that was a no go for me. So anyway, so I quit after my second bonus, I use my bonus to make the first personal investment for me and the upwey and private equity and it was in a And wine business that did really well, God just really, really quickly, like the founder had a vision and she like she acted on the vision anyway. And that’s when I was working for the founder of bonobos. And that’s how I found the deal. Anyway, like, fast forward when I was working for Andy Dunn, managing the portfolio, private investments, Walmart bonobos, right. And my job was to manage these private investments, and he was no longer allowed to make those investments, because it would be a conflict of interest. So then, I followed him to Walmart. And as somebody who grew up in New York City, and I’ve never been to a Walmart before, let me tell you going to Bentonville, Arkansas is really it’s it’s eye opening. It is
Shayda Torabi 5:39
eye opening. But as you can imagine they have medicinal marijuana in Arkansas.
Catharine Dockery 5:43
Yes, they do. They do. Yes. I would be surprised if any of them any of them were near Walmart headquarters. But
Shayda Torabi 5:52
there actually is one there. Oh, really interviewed for my my podcasts? Yeah, the sources, I can make a plug for them. So there’s some interesting stuff happening in Arkansas despite the Walmart headquarters being there.
Catharine Dockery 6:03
Oh, interesting. I mean, that you just expanded my whole mind on Arkansas. Sorry. To do. I love it expanding mines. Anyway, yeah. So I didn’t really want to do that job. I followed Andy because I had a lot of respect for him. But then after basically six weeks, like I just realized, like m&a was not something that I was interested in or passionate about whatsoever, especially corporate m&a. I mean, while it is important, and like as a seed stage investor, I do definitely rely on corporate m&a. Right. But for me, it’s not something I wanted to spend my future in. So I told Andy, Andy died. And he was like, You know what, like, I totally get it. He’s like, you should go and interview at consumer venture firms. He was like, I think you could do really well there. So I was like, okay, so I just cold emailed a lot of the GPS that these funds, and I was like, Hey, I’m looking for a job like, this is specifically why I think I might be good for like X, Y, and Z phone, I would always get an interview, and they will ask me to pitch a business. So then I ended up pitching this canned wine company. And they’re like, you know, and founders find a few months later, fast forward, I ended up leading their seed, right? So it was a big deal. And it was ridiculous, like, you name the fine a lot of the PMS or the GPS, or whatever. They wrote personal checks his company, but they weren’t able to invest out of the fun. And to me, that was just like, a part of my brand. It was just such a mindfuck, right. I’m like, so you’re allowed to do this. But your investors that you represent can’t get into the deals that you think are great, right? Like what? And I just kept hearing it over and over and over again, about this vise clause. And I was like, What the fuck is a vise clause? Right? Like, what is this that people have money around? So with lots of research, and like, I would follow up at the interview and be like, hey, like you said, one thing that really caught my interest. Can you please find one advice clauses, and I got around a dozen funds to basically tell me what the rights clause said. So I saw that it was it was for cannabis. It was for nicotine, or alcohol, it was sex tak like ketamine, psychedelics, like any any of the categories that I thought would have explosive growth and exits, based on historical performance. They couldn’t invest in. So then I had this realization where I was like, wait, like if all of these top tier phones that people love and they follow, and they hop in the round, just because they’re in the rounds, right? can’t invest in the seed stages of these businesses or the pre seed, I was like, there’s a huge opportunity for us, right? huge opportunity for fun to do that. And we started getting like, the more people I reached out to I was like, Hey, I’m so sorry, like not taking this job. I’m doing this instead, like, hey, so sorry, whatever. So all these funds started sending us seed stage vise deals, right? And that was the way that I really identified that like a lot of these companies struggled so much like so much to get funding in the beginning. But then they take off, right? It’s like a great example. I swear, this isn’t an actual blog. I really district this all day long. But we SAS right great example. couldn’t raise money in the beginning, like it was incredibly difficult. And now it’s like one of the hottest companies out there. Right. So it’s kind of the thesis of the book. No, I
Shayda Torabi 8:49
appreciate that backstory, because I think it’s important for people to kind of understand not only your journey, but to really frame it in the capacity of like, where these vise industries and specifically for this conversation, because it’s my industry too is cannabis. Just a small kind of like tidbit of a story. For reference. I had a friend say she posts on Instagram, she’s an influencer. And she was posting you know, make sure you register your business. If you’re an entrepreneur and you have a new idea. And I commented, you know, and get a website, you know, that adding value. And she’s like, did you register your business like, oh, fun fact, you cannot trademark a cannabis brand right now. And it’s a big deal. But it’s such a subtle deal that most people as they’re going into this industry don’t realize all the different roadblocks that they might run into. And so I think investing is one of those other areas where you just assume, like you acknowledge, hey, this industry is very exciting. It’s very fast moving, okay, I have a good idea. Maybe a good product packaging, I want to take it to market next pour some gasoline on is to invest in these traditional VC firms are not able to actually be investors. And it just kind of creates, I think, a roundabout way for people to really take advantage of the benefits that funding can help a business. So what was the deciding factor for you, I guess, in opening it Why not? Like Did you? Did you decide you were going to open an investment firm? Or did you just have a client first? Was it kind of like the right timing? Because Because I read your bio, you’re fairly young. And I know that that’s the point in your story that you kind of highlight. I know, there’s a lot of naysayers. Being a woman being young, it sounds like being advice. There’s a lot of things kind of fighting against you. But you know, for maybe people listening, if they’re like, Hey, I would like to start a fund. Or I’d like to start a VC firm, like, what does that even look like? How did you start it?
Catharine Dockery 10:27
That’s a phenomenal question. So let me start off by saying that I have the most supportive husband in the world and he will do whatever it takes to support my dreams, including working a job he’s not like, super in love with. Right until, like, make sure that I he’s the best, he’s literally so great. Anyway, so then I quit Walmart, right, and I quit to start this fund and like to get a trademark, you can’t work where you’re working, right? Because all of a sudden, like any intellectual property that you develop, like becomes your parent company, right? So I kind of had to quit somewhat abruptly because I knew that I was going to get this trademark. And like that, to me was how I was gonna start the fun. So then from there, I mean, fast forward a few months after doing the deck, I just started thinking for fundraising. I was like, I don’t come from a family that has money, right? Like, I can’t just call my uncle and be like, hey, like, introduced me to like, everybody at your country club, right? Like, it’s not really something I can do. So for me, I just sat there, and I thought it was a coup is the richest and most brilliant and most powerful investor that I could possibly find. And I thought about it, I actually gave it like, significant thought. And I was like, oh, Marc Andreessen. Duh, like, why don’t I think of this like two days ago, right? One of my friends gave me his email. I cold emailed him, and this is gonna sound crazy. I remember this, but at 142 in the morning, he responded, and with whoever the two other partners that were on the email, and he was like, I love this, like, this is brilliant, like, blah, blah. And I was just like, Oh, my God, like, he thinks it’s a good idea. I was like, Really? I just thought I was still like, on this, like, I was doing it full time that I like, didn’t really know like, and we’re getting traction. And yeah, and then I forwarded the email to my lawyer. And I was like, I guess I’m even Marc Andreessen. And he was like, because he kind of took me on because I was 25. At the time when I met him. And he took he’s a big, he’s a very high powered lawyer. I found out I did not know this. When I reach out to him. He had a beard. And he was from Southern California. And I was like, oh, like this is this is my dude. Right? Like, totally it. And anyway, yeah. And it like I boarded them. And he was like, wow, like, I guess we like to write the LPA that and I’m like, yeah, let’s write it.
Shayda Torabi 12:28
You got it? Yes. It started the ball rolling? Yeah, here you are. Yeah. How many clients do you have under your portfolio currently,
Catharine Dockery 12:36
so we have a portfolio companies, all of which we love very dearly. We actually host community nights for a lot of our founders, just because everybody despite them growing like adjacent industries, they actually have a lot of overlap. Right? Like, like vice distribution, like, is kind of one of the same, right? Or like vice marketing, like usually, like I have trouble advertising, right. So like PR is like a great way to go. Or, like anyway, and like actually, one of our founders is subletting space, one of our other founders. Right. And like that all happens on community that right? So those are something that we try to host every month, not every two months.
Shayda Torabi 13:13
So great. I want to kind of touch on and dive into that that community night idea. Is that something that your firm offers to your clients that you see maybe other firms are not offering? Or what differentiating points do you offer for your clients? Maybe there’s none, maybe it’s just Hey, we can support you because your advice, you know, business? Or are there other things that you find that you’re able to kind of help them because you have this community?
Catharine Dockery 13:40
Yeah. So I would say that one of the two most important people in the community is my analyst, Aaron runner and my chief of staff. So aces, Vice mentors definitely would not be as far as it is now without a very, very strong team, right. And then when it comes with what we offer founders, we tend we find ourselves in a very lucky situation where we’re not really fighting for deals. Just because we offer great distribution, we are true partnership, we work very, very closely with our founders, we in some cases, we help them actually build the deck. So for us, it’s much more of like building this like somewhat like like we’ve made some really corny but like a family like community, right? where everybody is working together and like asking each other questions, and even some of our LPs will come in and be like, hey, like, I’d love to talk to this company. Like, I just started talking to like Costco, for example, right? And Costco really wants to carry this product. Like, is it okay, if we connect them? Like, yeah, of course. Right. So we’ve built a very cohesive environment, our founder community as a community. And I think that speaks volumes, right. So like one of the founders, for example, they asked us, what do you do for us? We don’t even answer like, we just connect them with one of our other founders. And I found that to be a much more a better use of time, right? Because then the other founder is also kind of interviewing that founder, right? And see, like, if they like that person, and it’s like a whole thing. Yeah. I hope that answers your question. No, that
Shayda Torabi 14:58
totally answered it. I guess. For me, maybe for people listening to I always like to kind of connect the dots and also fall on the cross, so to speak of like full disclosure. You know, I’ve been in business in cannabis professionally in Texas for two years. I formally before this was a director of marketing for a digital agency. And prior to that I was actually at one of Austin’s very top fast growing tech startups. So I was with them for six years went through a couple rounds of funding, but originally, they were bootstrapped. So I witnessed kind of that aspect of kind of startup life and growing a business and growing a brand. For our company, we are still bootstrap. So I have no investors, it’s essentially a family fun, which is exciting. I know the power of getting investment, but also, obviously there is some trade off. So I kind of want to dive into that for people to kind of understand, you know, obviously, there’s a lot of positives, maybe you can highlight the positives, and maybe what some of the, I don’t want to call them drawbacks, but the reality is like, I’m sure the terms are different with every client that you bring in. But obviously you’re someone is giving up part of their business so that you can have ownership, you can sit on a board position, kind of walk me through that, if that’s a fair question to ask.
Catharine Dockery 16:06
That’s it’s really fair question, I would say that most businesses aren’t meant to be venture funded at all. And I think it’s really underrated, to have a business that you personally put your own personal capital in, if you’re able to do that. And you grow it that way, right? And you actually, like make money off of the revenue that will eventually be generated. And when somebody comes to buy the business, if you they buy the business, it’s all yours. Right? So you’re getting the entirety of the check. One thing they can say about bootstrapping is that the you don’t necessarily have the same resources as somebody who took 5 million from a fund that is like no for beverage, right? Or is known for cannabis or whatever. You have to be like, I think like a pretty autodidactic human as well as being incredibly motivated. Right? I mean, I would say the same traits would apply to somebody who does get better Medtronic as well, I just think it’s like more highlighted on somebody who bootstraps, right? And then when it comes to venture funding, like I mean, the pros are that, like, you have more capital to scale your business faster, right? And like, Who doesn’t want to do that? Right? If you can, if you’re able to do that it makes sense your business, then it makes a lot sense. But I mean, the bad part, obviously, is that you’re going to dilute your ownership, right? By raising more capital, like by nature like that. Exactly. It was like what is going to happen? And you have to realize if you’re okay with that, I’ve spoken to some founders who have put the coolest valuations on their businesses because they don’t want to lose their ownership. And I’m like, Well, no. Like, I like no, like, I’m not gonna like we’re not gonna invest in ridiculous valuations like either, like, do the venture funding route or don’t do the venture for bigger out, right. But I guess those would be like my comments on bootstrap first. No, that’s fair. And I think I watch a lot of shark tank. So maybe that’s a little or a lot about me. And I’ll always,
Shayda Torabi 17:54
always, like he’s like, do you want a little bit of a pie? Or do you know, a bigger piece of this pie and it’s like, oh, maybe I should go get funding because then the pie is bigger. And even if I got a little bit of it, I still have a bigger piece of pie than if I’m, you know, growing it myself, which to your point, I appreciate the candidness because I do think, at least for my audience, when it comes to cannabis marketing and strategy and growing a business in this space. It’s obviously very sexy to get into cannabis. It’s like the green rush. everybody’s like, who I mean, even having a retail people come into my shop. They’re like, Oh,
Unknown Speaker 18:23
this looks fine.
Shayda Torabi 18:24
I’m gonna open a CBD dispensary. Like Good Luck. Very much good luck to you. Just because there’s so many hurdles. And you kind of you know, alluded to some of them too, which is, I think a cool aspect of having a fun that is. Obviously it makes sense. You’d want to go work or be invested in by a firm that has familiarity with your industry, because they can help add value. Like you said, the other founders can kind of learn from each other. How are you getting around this advertising? What platform Are you using to sell online? But I think from my perspective, you do have a lot of people who see an opportunity to get into cannabis and then they just assume like, Oh, I have this idea. Someone’s just gonna want it. They’re gonna buy it. And it’s like, Yeah, but how you market it, how you go get funding, how you set your platform up, those are all very real big question mark saying that the industry is still trying to navigate. Which kind of leads me to my next question, if I can poke a little bit because I was having this conversation last night with some friends and cannabis and CBD in particular. cannabis is not federally legal, but CBD is federally legal. And even though we have some of these discrepancies, even though CBD is federally legal, so let’s bring up like recess as an example because I know they’re your portfolio client and you’re drinking them so let’s kind of use them as an example. How do you vet them? How do you know what the products that they’re pitching to you? is not just a sexy you know, a snake water in a can How do you know that it has actually cannabis in it because for my knowledge, there’s a lot of big brands out there that are coming up in reports now saying there’s actually no CBD but because it was unregulated anybody can get away with putting product in a bottle and essentially selling it. I could imagine as an investment firm, there’s a lot of people who want you to invest in them. But I can imagine that what’s actually in their product is not the true product. So how do you navigate that? How do you, you know, do your due diligence essentially?
Catharine Dockery 20:16
Yeah. So I guess I’ll start with resize. I mean, it’s a great example, right? The first time I met with Ben with us the founder, this was pre product like this was preceded, right? He didn’t, I never tasted it. I went through a tech with him. I asked some basic questions on like, what he thought and then like, all of a sudden, immediately, I was like, he’s gonna win. And like, How do I know that? Because he, he’s a visionary. And he has the ability to actually like, execute and like, create a plan for his vision. And a lot of founders you meet don’t necessarily have that, right? Like, they’re great visionaries, but they like they don’t know how to like, put the pieces together. Right. So Ben, I was like, I told you, I’m backing the tour’s 100%. Like, who would have questions. And part of the reason also why we did it is another huge part of our diligence is because we’re brand investors, we take brand super seriously, right? And if you think of recess, almost every American, I would bet $1,000 on it, right? They have taken a recess at least once in their lives, right. And I guarantee you like they have very nostalgic for the times when they had like an hour of free time to like run around and play in the sandbox, right? Like, who isn’t nostalgia for that? So yeah, so that’s another reason why we backed resize, and something that we also look at, in addition to that, if it’s not a product company, or if they have samples, again, we rarely take a meeting with a brand if they haven’t given a sample. Just because we need to do our own testing, right, we need to know like, is this product? Like?
Does it work? Like
Catharine Dockery 21:40
a lot of the products don’t work would you would be like totally surprised by doesn’t taste good? You we just the whole group think it tastes but we all like our group is like very different taste taste buds, I guess. So until unanimously like, do we think this is a good product, right is another thing that we’d like big very, very, very seriously. And if we do get past the point of diligence with the company, and we think we want to move forward, we send your product, basically, we ask you to send our product to like 20 different people, like all over the country, right? And then we’re like, okay, like, does this make sense? Like, do they like this? What areas is more popular in or like, whatever, there’s something that we like, very, very, like we take it to the utmost seriousness is product because like a founder, like if they came up with a good product, like they probably know how to execute, right? And they probably know how to sell and raise money. If they have you’re already, like so late in the conversation.
Unknown Speaker 22:26
Catharine Dockery 22:27
that I guess it’s part of our diligence, for sure.
Shayda Torabi 22:30
No, that’s helpful to understand just because I think so many people might have the vision, but then the product isn’t there. And so sometimes, I wonder, obviously, watching the market explode. I do think, from my perspective, there’s Gosh, now probably over I’m going to use a large number 1000 different CBD water brands. Yeah, no. And when you break it down, sorry, to kind of, you know, peel the curtain back not sorry, it’s all CBD water. You know, there’s not like a better CBD. I mean, there’s definitely better CBD, it’s high quality. And then there’s crap products that don’t test out at the right percentage. But if you’re sourcing from like a high quality supplier, it CBD in a bottle of water, essentially. And so at that point, it’s the commodity you have.
Catharine Dockery 23:15
So I would actually disagree with that. I do think that there’s obviously like a lot of products that are like a dime a dozen, there’s like a million of them. But when it comes to cannabis or CBD beverages in particular, it doesn’t really it doesn’t matter as much where they’re sourcing their CBD from to me as if it matters is Do you have your emotions, right? Like there’s only so many of these beverage companies that actually go to like a proper emotion
Unknown Speaker 23:37
or general emotion.
Catharine Dockery 23:38
Yeah, like otherwise, like the CBD or cannabis or whatever either floats on the top or just sticks to the side of the can and like to us, that’s our number one question. When we’re talking to a beverage we’re like, who does your emotions? Like? Because we know all the players, right? So we know if you’re skipping out on like the wrong things. Right? That
Shayda Torabi 23:54
is no point. That’s absolutely fair point. Because I do think depending on what the product is, depending on the packaging, and specifically with canned beverages, there has been a lot of external research being done saying if it’s not emulsify properly, then it will stick. I didn’t want to go that far. But yes, I think that was where the point was alluding to. You have a lot of people who want to put CBD in a bottle. And then it’s like, what is the quality of your product? Where do you source from? I think not so much right now in the industry that I’m seeing maybe you have a different opinion. But definitely two years ago in the industry first kind of opened on a CBD perspective. Yeah, I saw a lot of full spectrum products saying no THC. And I think that the industry has rallied around that. That’s not accurate. But I think you had a lot of brands who were like, yeah, CBD it’s full spectrum, but there’s no THC and it’s just such a disconnect to the consumer. So I imagine extrapolating that where you have such a nationally recognized brands like recess now is at this point, obviously part in fact, due to yalls aid and investment in the company, but I think they’ve done a successful job, but I think that’s where I’m resonating with too. It’s not just like getting into the industry, obviously with having like a new Union. Idea necessarily, but the branding really around it. So it sounds like recess really had that brand put together as well as the quality of products that they were packaging together.
Catharine Dockery 25:10
Oh, for sure. And I don’t know if anybody’s ever had the opportunity to hear Ben woody speak, but he is obviously truly a genius. Everything he says, oh, wow, amazing.
Shayda Torabi 25:21
I haven’t but I would love to talk to him next. Always make a plan for that. I guess let’s kind of shift in position it let’s say there’s somebody in the audience who is a brand, you kind of touched on a little bit of it. But if someone is a brand, what do you expect to see from them? Do you always expect to like are they pitching you? Are you meeting? Maybe you go to a cannabis conference or vice, you know, conference and you’re patrolling the floor? Like is it two ways? Is it more one way? And then when you interact with that brand? What does that brands need to kind of bring to you or have set up for you to even kind of qualify? And basically trying to ask if I’m a brand in the audience, and I would like to be considered for investment through your firm? What do I got to do to be considered?
Catharine Dockery 26:05
So I would say I mean, I think my analysts would have my cheapest, one of the best answers on this because they take all the first meetings are fun. But in order to get our attention, it usually requires a well written email, right? Just be like, Hi Catherine and spell my name correctly. Would she be like we’re really interested in potentially working with their phone and like for these three reasons, right? Like, whatever the reasons are, that you want to work with us, I will take the meeting, even if it’s sometimes even if it’s not a base company, I personally will take the meeting, to the point where we actually I set up this guy with this girl, and they’re not married, but they’re co founders now. So like we’ve, like gone out of our way to make introductions and like help people think of what to do next, right, like we are, we’re super collaborative, firm if the person is a good person, so I can say, But back to the pitching. If you do want to pitch us in email info at vice ventures calm, and then one of us will get back to you as soon as humanly possible.
Shayda Torabi 27:04
I’m going to make a quick plug for anyone, I guess there’s a comment section we’re going to be getting to those towards the end, I would love to open it up for people if they have questions so far to go leave us some comments that way we can get to those in a little bit. But yeah, I think that’s always just kind of good understanding, especially as the industry continues to evolve. I think we’re going to start seeing more I mean, I’m a really big believer that we’re just scratching the surface on cannabis. I mean, the lack of research that’s been done in this industry, and the amount of products and consumer fanfare that has been created is like such a chasm. It’s like, wait, what’s happening? And how did people hear about these things? And then I’m sure going to trade shows, you’re seeing all these new different types of I mean, at least for my role, specifically cannabis products from vice ventures? Are you really dealing with mainly CPG? Or do you get into other applications? So for example, I saw like a CBD pillow. If that was something interesting, kind of comical at this point. But if that was something interesting to you, is that something that you would potentially want to introduce into your portfolio? Or is it more like on the consumer packaged goods side?
Catharine Dockery 28:11
Definitely more than consumer packaged goods that one of my favorite investments? Actually, is this nicotine gum? I think this shows exactly that’s a harm reduction product from jewel or from any other vaping issues. But yeah, I mean, we definitely we mostly do CPG for vices, we did invest in one platform, that is a betting platform. So you can play sport like eSports for money or video games for money, basically. But that’s the only nine CBG product that we’ve invested in today. And it’s not that we’re not open to it. It’s it’s just like, I’m like you think of my background like I’m a brand investor. Right. So like, that’s what I feel comfortable investing and like, that’s what I know really well. I don’t have you ever given me a stash business? Like honestly, I’m probably have to do like a ton of googling, right. Like to lay out like intelligently. Like, think about this business. So yeah, so we’re I mean, that’s where a lot of our connections lie. Like, that’s where our expertise lies. As a firm, we also work exclusively with this brilliant creative agency that actually did recess. So we all our brands get like pushed through there. Yeah, we’re very hands on for sure. Well,
Shayda Torabi 29:15
I think that’s really cool. For me, and I’m sure listeners to understand too, is just sounds like obviously, there’s a ton of different types of firms. There’s a lot of different industries. Specifically, if you’re interested in vise industries, obviously your firm seems to be like the best fit pertaining to this conversation, but it’s always helpful. I think myself selfishly, always included is like, I just don’t even know what opportunities exist out there. Or if I have a brand or product like how do you even get it in front of somebody or what what can I do with it? So I think it’s always good to just, you know, ask the question, even if the answer is like, yeah, just email me. It’s like, wait, she said you just email her Okay, like, get ready girl because their inboxes gonna be flooded with ideas, but Yeah, I think it’s a, it’s an exciting for me to understand too for me because I think another question I have, which you answered was, how important is the brand development versus the conceptual idea when you’re investing in a product? And it sounds like with recess being the example we’ve been kind of talking about, they were just a conceptual idea. But it was, yeah, powerful. It sounded like you liked the founder that that was enough of a selling point, versus feeling like you had to have like, your whole business plan, a pitch deck put together and like prototype product? Yeah, I
Catharine Dockery 30:27
don’t know. I mean, we do want a product of some sort, right? We want to know, like, because it reflects also on your thinking, right? If any thought process like, like, what, which operational steps as you go to get this done, right. Like, that’s something we take very seriously. But yeah, I think brand is super, super important. Because I don’t have to tell you, but like Americans will buy literally anything, right? Like, if it is branded? Well, it will sell very, very well. So we take brand incredibly seriously, we hate brand messaging seriously, we take like PR very seriously with our companies, like we actually create, like provide PR basically like a lot of our companies in the beginning. Because that really can like make or break a band. Right? Like,
Shayda Torabi 31:07
yeah, it’s like such a novel idea. But I think that’s where from my background, being in marketing and branding in particular. So it seems like common knowledge for someone like me, but that’s where I started having these conversations through this podcast medium. It’s like, most people are not thinking in that capacity. I think they think like, Oh, I want to get into this industry, I have this really great idea for a product, but they don’t package it like someone last night, they handed me a CBD energy shot. But by weights, the amount of CBD diluted had seven milligrams of THC. But the shot Look, I maybe you’ve seen this, it’s pretty, I think it’s a national brand. Not gonna say who it is. There’s just a funny thing that kind of came up in pertaining to this conversation. It looks like a gas station brand. And my friend handed it to me like, would you put this in your store? And I was kind of like, No fucking way. It doesn’t, to me sometimes doesn’t matter how great the quality of product is, I care about the quality of product, but if the branding doesn’t match, and again, branding is a little subjective, because there are a lot of people who I’m gonna go. Yeah, exactly. They like to shop where they want to shop. And so I just think as an industry, we’re trying to fight that, you know, because it’s unregulated. You can sell CBD products and gas stations. But if you obviously want to have maybe more national consumer base, you might want to consider having a nicely branded product that doesn’t look like it would be sold in a gas station. So the things we’ve seen, I’m sure, but kind of on that question I have for you is how do you see vice ventures being a key, I guess, piece in helping legitimize cannabis, because I think when it comes to branding press, obviously having investment money is what allows you to kind of fuel a lot of that otherwise, you’re me doing press and branding and retail and e commerce all by yourself, which is doable. It’s fun. But it you know, coming from your side of the house, I mean, I get asked this all the time, you know, kind of a flip side of the question is is media, people like do you? Why do you do like the media talking about cannabis? Or does it hurt? I’m like, well, Hey, good or bad press is still press. And it’s helping push this conversation into the mainstream. So considering how you even started your businesses, because these vise clauses are very real, and a lot of mainstream investing doesn’t afford for the opportunity. But then here you are being like, not only are we going to do it, we’re going to do it well. And then I see you investing in brands like recess recess has been helping push cannabis into the mainstream getting picked up in Forbes and refinery 29 all these great places. So I don’t know if there’s a specific question, but like, how does how does that that rule that you sit in help the industry? Yeah. So
Catharine Dockery 33:46
I think just looking even beyond cannabis, like every industry that we invest in advice mentors, are basically like one of our social missions is to eradicate stigmas around these topics, right? Because like, I mean, I grew up in a bar right? So for me, alcohol was always like a way to support my family or like my dad to support me right? Like that’s honestly what I saw the job as. And for me personally and emotionally when I was pitching this alcohol company to all these buttons, the fact that so many number like Oh, we don’t do alcoholic, it’s terrible that we don’t do alcoholic. To me, I was like, wow, like, as a country. We have so much work to do, right? Because I don’t I mean, I don’t know the stats behind it. I did at one point, but I do know that there’s like obviously a drinking issue in America, right? Like people drink every day. people drink all the time. Like they’re serious. Yeah, especially COVID like there’s serious alcoholism and there’s serious other drug abuse, right. And I just think if you’re able to talk about like, hey, like, I just got this great glass of wine. It’s amazing. Or like, hey, like, I love recess because I it’s replaced by I don’t know, like my five o’clock wine, right? Like whatever. I think that’s super, super powerful, right to get the conversation going around like a harm reduction angle.
Shayda Torabi 34:55
No, I think that’s a very fair point and I share the same excitement slash ownership. But like those of us who operate in the space have to kind of lean into helping normalize it. And I think normalizing it by being loud and being professional, but loud in the sense of like, Hey, we’re going to be risky and take a chance on these businesses take a chance on ourselves by launching a fund in the space. Obviously, it’s not just like cross your fingers, close your eyes and like jump, but it is a little bit like, I think people just don’t really realize how nebulous cannabis and therefore vice industries really are. And so it’s exciting to want to get in and launch your brand and get funding but obviously the flip side is then now we have a brand and now I have to educate them and I have to make sure that they want to pick my product on the shelf and not somebody else’s product. Those all have their own hurdles and attributes as well. So I think that’s a that’s just part of the game, isn’t it? It’s fun. It is fun. That’s why we’re working in this vise world girl I’m so excited.
quick break to say thank you to restart CBD for sponsoring this podcast. Restart CBD is a brand my sisters and I founded in our hometown in Austin, Texas. We operate a retail location as well as an e commerce store and you can browse our wide range of CBD products at restart CBD calm again, thank you to restart for allowing me the time and resources to put on to be blunt. I hope you’ll check them out for your CBD needs. Let’s go back to the episode. I’m going to turn it over we’re going to start asking or answering I should say some of these questions I appreciate the people who have left some questions for us Let’s see. Someone says I love Canada it’s great for events activities were class isn’t welcoming. That’s a really fair point. I think we’re seeing a lot of especially just like, I don’t think vise is explicit but I think it’s fun to see where these vise brands are pushing. What is acceptable when it comes to packaging? I know cannabis in general there’s a lot of heartache when it comes to packaging because a lot of that is dependent on the state. I know CBD to full on THC. There is some a little bit more leniency on the CBD side. But uh, yeah, this thing is exciting to just to see like where these industries disruptive are actually disrupting some of the future things that we get to go through. What is a product that you haven’t seen yet, but wish someone would make
Catharine Dockery 37:27
it impossible to answer. It’s impossible to see what I wish I could have seen right especially doesn’t already exist. I would tell that person to dream big. Go for it, figure out the product you want to start and then email info advice bunches.
Shayda Torabi 37:41
I’m going to answer that because i think i i’m sure this is coming one day what excites me the most about cannabis and maybe this will get some people’s inspiration juices flowing. You know, there’s all these CBD oils, I’m sorry, probably recess takes the cake. There’s enough CBD sparkling waters we don’t need anymore. There’s enough CBD edibles. I think getting into the terpene conversation, though was really interesting for me, I imagine a day a consumer will be able to take a DNA test and and this is kind of already somewhat there. We’re going to take a DNA test and see what their DNA profile is. Maybe you can attribute certain ailments or family, you know, medical history, and then it will produce hey, these terpenes, which for those of you who don’t know, terpenes are natural, essentially aromas, flavors that add the effects of what cannabis is. But they’re also found in things like pine trees and lemons, limonene, sitting things like that, but they are very much active in cannabis. And I think we don’t talk enough about them in this industry that that’s where I would see in the future is us being able to take these profiles, someone walks into a store takes a test online, and then they’re produced, hey, here’s these products with these certain cannabinoids, these certain terpenes that are specific to what your body needs. I don’t know if that’s one product or more just like a service opportunity. But that is the future that I would like to shop in specific cannabis products. So the next question is somebody says, are you investing in cannabis retail experiences? And if so, what are you looking for? And if not, what cannabis retail experience Have you personally had?
Catharine Dockery 39:11
We don’t invest in retail or real estate to be honest. One I think an amazing cannabis retail experience that I’ve had is at sweet flower on Melrose and Los Angeles. I think they curate a phenomenal kind of selection of brands of cannabis brands and then on like a lot of other bud tenders that I’ve come across at three power they really know their stuff so they make like very solid recommendations and they like know the differences between the brands and they’re not just brands right so they’re actual companies right? I don’t know, but sweet flowers just honestly it’s amazing. Everybody should go if you live your life. Yeah, I
Shayda Torabi 39:46
think the cannabis experiences and another thing to write because you have CBD which can essentially be sold in costcos and gas stations and CVS pharmacies and CBD dispensaries but then When you’re dealing with specifically high THC, anything over point 3%, specifically coming from the marijuana plant, you’re dealing with a product that is only legal in certain states, right. And so purchasing those products has to happen within that state. And so I think people don’t realize that like, let’s say recess had THC in it, recessed would have to be manufactured in California as a legal state, as well as be manufactured in Washington as a legal statement could not take it by truck, essentially, or ship it like you would current products. And so I think that side, the full on THC side is an interesting one, because it kind of limits you in the state. But it’s
Unknown Speaker 40:37
also an exciting opportunity,
Shayda Torabi 40:38
because some of those brands are already expanding across the state, like I just saw one of brands has now distribution at the top edible company coming out of Colorado, they’re in California, they just expanded to Canada. And essentially, they have manufacturers that have an each of their different markets that allows them to operate that way. Let’s see another question. How do you address the controversial position that CBD is fairy dust and doesn’t do what it claims?
Catharine Dockery 41:04
I would say probably I would very much recommend that that person get educated on CBD before they make statements like that. I would also say that they there’s a new bill coming out in the house that basically says what CBD can and can’t do. So if you’re one of those people that don’t believe in the power of it, I would really recommend that you get educated.
Shayda Torabi 41:24
Yeah, I think just to add to that there there are a lot of people who claim that it will do a lot of things that it actually won’t do. So I agree with Katherine and getting educated figuring out what products work for your body as well in the best way personally to explore CBD is to try it and obviously know what you’re getting into. But in terms of cannabis compared to other types of vices, perhaps like alcohol, obviously, there’s a lot of reports that you can overdose on alcohol and have some liver damage. I think the reports are still out on cannabis. So definitely take it easy, but I think the best way to explore what would work or wouldn’t work is to actually put it in your body and just keep track of Okay, I drank this recess, it’s 10 milligrams of CBD. How did 10 milligrams make me feel versus when I took 10 milligrams of this other product? If you’re just consuming products willy nilly, and you don’t have any sort of goalposts for what is quality or what are milligrams or what is isolated or versus full spectrum. I’ll also make another pitch you can my Instagram is right there to be blunt pod. You can DM me, I like Mark insurance and very knowledgeable about cannabis and CBD education. So happy to always have those conversations offline. Somebody did ask if the fund is closed? Or if you’re still raising money if you’d like to answer that.
Catharine Dockery 42:37
Yeah, we’re definitely still raising money. We’re doing one last fundraising push as we got super lucky that almost 100% of our LPs wanted to put more money in. So we’re able to extend our fundraising window. anybody that’s interested in investing, please feel free to do email, input asuntos. And we take it one by one basis.
Shayda Torabi 42:54
This is another really good question. How does your fund actively D stigmatize suicidal notions surrounding cannabis and alcohol,
Catharine Dockery 43:02
we believe in the power of PR. And we as a fun have gotten a lot of PR. And we’ve talked a lot about how we’re hoping that vice mentors itself just the name bystanders, right, like get people thinking about like, what is advice? And like, why is this advice? And like, why aren’t people allowed to invest in these companies early on, especially if they are a harm reduction agent, right to like, what was going on before. So that’s kind of like what we invest in. And that’s why we believe we have a PR team, and we’ve had them for two years, and all our companies work with them. Because we think it’s also adding a social good as well as helping people be aware of their products.
Shayda Torabi 43:33
Yeah, I’ll just echo that, too. I think that is a big driver that I’ve seen, obviously, small brands like myself, I secure a lot of press for us. But it’s certainly not the scale that I’ve seen recess and other brands in the space go secure. And I do think kind of tying into the comment that I made earlier. I think it’s important for these bigger brands to go get some of these investments so that they can bring it into the media in that capacity to help further normalize and bring awareness and bring education to people who otherwise wouldn’t have that product put in front of them. So I think there’s a lot that we can all learn in the industry as we’re kind of pushing everything forward. So what is the most bizarre vise product you’ve looked at?
Catharine Dockery 44:10
Um, definitely sex dolls that self lubricate, and the hair grows themselves. And they have at use even by the body. So this isn’t the most interesting company I think I’ve seen in the entire device. So you buy you buy the body, the bodies $5,000 then you buy the head and the head has AI and ml like machine learning, whatever. So it develops a personality with you. So you talk with a doll, and you can switch heads and bodies. And people like the average person who buys this, they buy five of them. And it hasn’t even it hasn’t lost internationally
Shayda Torabi 44:44
yet. Just in the US. It is a truly special business. I was going to allude maybe it’s an international business was going to hit America but you just flip that one on its head girl.
Catharine Dockery 44:56
Yeah, talking about overcoming stigma is there honey?
Shayda Torabi 44:58
That’s right. Oh, My gosh, one more to come. Um, okay, last question. We talked about trends and opportunities in cannabis, alcohol sex. Are there any emerging markets you’re seeing with vices that we haven’t, you know, outlined as the major ones?
Catharine Dockery 45:13
Yes. So I guess we are very bullish right now on nicotine alternatives. Just because if you’ve actually seen the data of the past 60 years nicotine I mean, tobacco use is literally just gone like this, right? It’s like just kind of died out. Like Think of how many people that you know, smoke, right? Almost nobody, I don’t know anybody that’s cigarettes. Anyway, and but then if you look at the nicotine trend, nicotine is just going up, right, like we have a whole new generation of nicotine users for the first time, you are going to want to either stop using nicotine right or are going to want to transfer the nicotine addiction to something that’s much less harmful. So we are very excited about all the nicotine alternatives that are coming out that are both smoking cessation products and recreational products.
Shayda Torabi 45:52
Thank you again to the VC summit for initially having me at your summit to interview Catherine. And I’m so grateful I was able to repurpose this conversation for the podcast because I think investing is something that most brands in the space are curious about, but aren’t really sure how to go about it, if investment is the right move for them, and so on. So, I hope this gave you some insight into vise clauses and how you can think of positioning your business if you choose to pursue a VC funding route. I know Katherine and her team are always looking for new businesses to invest in. And if you think you have a real differentiating winner, I encourage you to reach out to her. And if you have questions about marketing your canner brand or want a second set of eyes, I’m also always available to share more of my expertise. And I encourage you to connect with me on social media either through the show at To be blunt pod or my personal Instagram at the Shayda Torabi. Thanks again and see you next week for another episode. And by the way, if you enjoyed this episode, please head to iTunes and give it a five star rating. Thanks so much. Have a great one.
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