Meet the co-founder behind one of the best edible lines in the country
Coda Signature is an award-winning, multi-state, premium cannabis infused products company based out of Denver Colorado. Founded in 2015, Coda Signature manufactures wholesale premium infused edibles, topicals, and concentrates products for the medicinal and adult use markets in Colorado and California.
We sat down with Mark to talk about his journey from working with traditional big business to helping build one of the fastest growing edible companies on the market.
Tell us how you made the transition from traditional businesses to the cannabis industry?
It wasn’t something where I woke up one day and said, “Ooh, I should go do this.” [laughs] It was a combination of events: being in the right place at the right time, to be perfectly candid. I grew up in Colorado but, in my early thirties, I had been away because of a job. I was recruited back to Colorado in 2011 to take a senior position at a public company. I honestly thought I’d retire at the company I was working for. But from the time I moved back to Colorado, you couldn’t help but see what was happening in the cannabis industry.
In the summer of 2014, I met my business partner Elizabeth Cook through mutual friends. I’d never met anybody in the cannabis industry and I was intellectually curious. I’ve been a serial entrepreneur, Coda Signature is the fifth company that I’ve started, but when I originally met Elizabeth I had no inkling of going into the cannabis industry.
She grew up in Colorado, moved to New York City for college and ended up staying in Manhattan to be a psychotherapist for about 25 years. At that point, she made a pretty significant life and career change. In 2010, she moved back to Colorado and opened up one of the first medical dispensaries in downtown Denver. At that time, laws only permitted medicinal cannabis. The Marijuana Enforcement Division–what we refer to as MED–wasn’t even formed. It was underway. The early regulatory framework often meant companies had to pull out their checkbooks and write big checks every time there was a regulatory change. It could be packaging; it could have something to do with the real estate or security.
For Elizabeth, this was her first foray with a startup and she had bootstrapped it. It was probably pretty stressful. But, in a stroke of luck, MED required medical dispensaries to have vertical integration. That meant, of the flower she sold in her dispensary, 70 percent had to be grown from her own cultivation and the patients that she had signed up. Naturally, she had to find a warehouse. She had to get it built and find experienced cultivators. Instead, she decided to sell her licenses and keep the real estate, which she had locked up for several years. She did very well with that. When recreational cannabis rolled out in Colorado in 2014, she contemplated returning to the industry. She learned about my background and asked me if I’d help her put together a business plan so I did a deep dive into the industry.
You start by looking at the value chain. We looked at the value chain from cultivation through retail. We felt brands would be a very important element of that chain over time. We really didn’t see any premium brands in the market. Long story short, after helping her with the business planning and doing research and the financial modeling, it felt an opportunity that couldn’t be passed up. So I left a very big job at a global company to do Coda Signature.
You’ve settled on edibles, topicals and concentrates. Which portion of that market is the fastest growing for you?
Interesting question. You have to parse it into a couple of layers. The fastest growing–not necessarily for us, but as an industry–is concentrates. That being said, edibles are an extremely fast-growing category as well. The latest BDS [Business Dynamics Statistics] data states that edibles are growing 15 percent yearly. In Colorado, the growth rate is actually flattened because Colorado’s industry is fairly mature. But if you look at California, the growth rate is much higher. Topicals also have a significant growth rate. But it’s a very small baseline it starts from. If you’re starting with a small base and you increase it, your growth rate looks enormous. But not the dollar value. I would prioritize our business around edibles, topicals, then concentrates. We’re known for the effect of our edibles and our topicals, which comes, not only from our ingredients, but the oil that we process in our facilities. Since we’re processing oil for our two big categories, it made sense for us to also extend our product line into concentrates.
How do you decide on the designs for your edible line?
All credit goes to our head of edibles, Lauren Gockley. I’ve often heard people ask, would you rather be lucky or good? You need a combination of both. We were introduced to Lauren just after Elizabeth and I had founded Coda Signature as a company. Lauren’s a classically trained chocolatier. She studied at the Valrhona Chocolate School in southern France, but really honed her craft when she moved to New York City after her studies in France. She was fortunate enough to work for Thomas Keller, probably one of the more famous restaurant owners in North America. His restaurant Per Se has been ranked over the last decade as one of the top ten restaurants in North America. She worked for Thomas Keller making desserts where she really honed her skills.
When Lauren joined us in 2015, we spent a lot of time looking at everything in the market. We wanted to identify gaps. We didn’t see artisanal chocolates and felt that we could come up with flavor combinations and a higher-end look that could stand out from what was offered in the market. I think we did a fairly successful job. We shipped our first product in March of 2016 after building out our facility and hiring our management team and securing licenses. We only had four SKUs: two truffle collections and two hot chocolate on a spoon. About two weeks after we launched our Crescendo collection, it won first place at the High Times Cannabis Cup for Best Edible in Colorado. That was our stake in the ground. We’re in Colorado and were going to be a serious contender. I’m thrilled and incredibly blessed to say that, from the time we started, we grew from introducing just a couple of products to the market to having the number one market share in that category in Colorado, with just under 24 percent. market share.
Tell us about your R&D process.
It’s evolved over the years. Every year we have a product strategy session. Lots of work goes into it. It informs our product roadmap for the next year and ties into our budgeting process. It’s a fairly disciplined approach. We really upped our game this year and have made it more rigorous. Elizabeth is taking the lead on that, which comes from her love of the category. We’ve brought in a team of tremendous resources to support her.
Before we decide on new products, we do a market analysis of what’s currently available and the latest trends. We look outside of our industry at the latest food trends. We consider latest trends in skincare, cosmetics and overall natural body care. That analysis informs specific product ideas that we have. Again, we look for gaps in the market where we can bring something unique that has significant potential to drive real growth for the company. When we find that idea, we prioritize our resources, people and money around that.
What other emerging markets are most exciting for you?
It’s an interesting time to be in this space. We have a group of world-class investors behind us. We closed our Series A round with three top tier firms. We’ve got Gotham Green Partners who’ve probably put about a half-billion dollars to work over the last two years. They’re very close to what’s going on in each part of the industry, across all of the markets. We’ve also worked with Granite Hall Partners out of Chicago, Salveo Capital and Mazakali. Their insights help us in terms of where we go next.
We’re currently looking at multiple opportunities for expansion and ways to expand, whether we do it as we’ve done in Colorado and California– where we build out a facility ourselves–or whether we explore partnerships. We’ve started conversations with multi-state operators [MSOs]. When you consider a partnership strategy, you have to consider the markets that you want to be in. Where are they located? Where are they strong? You can’t be strong everywhere. Also, is there a good, cultural fit between us and them? Can we bring a core competency that they don’t have? We’re in the middle of those conversations. Illinois, Michigan, New York, Massachusetts, Ohio and Florida are all really interesting to me. Florida is going to be a massive market, but right now it’s predominately flower-based and still only a medicinal market at this point.
There’s been a recent surge of injuries as a result of vaping. Has this issue affected the industry and how will the industry move forward from this?
It’s probably premature to say how it’s affecting the industry. I know that industry associations focusing on this very closely, as well as the government. First and foremost, we have a responsibility to make sure that consumers are safe. That’s more important than anything else we do. That being said, we shouldn’t overreact until we understand it better. I don’t believe that anybody has really been able to isolate the root cause yet. But these incidents need to be taken very seriously. Resources need to be focused on this.
In terms of Coda Signature, this is a small part of our business because we use only natural ingredients. We work with our compliance department to make sure that we’re giving consumers the information that they need to make informed choices. We make sure that we have information on our website about what’s in our product and to feature a Q&A so that consumers who are considering a Coda Signature product have information to make an informed decision.
As a marketing expert, what do you think are the best ways for cannabis companies to market themselves?
Make the best product you can. I know that sounds rather trite, but my belief is that, if you don’t have a quality product to start with, all the marketing spin that you can create for a product won’t matter at all. First and foremost, it’s all about quality. It’s about being authentic and considering the overall customer experience. Really sophisticated marketers, which I’ve been very fortunate to work with, understand that a brand is the culmination of every touch point, every experience that a consumer has.
Say you’ve got a question about your favorite brand. You call customer service but have a horrible experience. No matter how good that product is, that experience will affect your view of it. So what we’ve really thought about very consciously, even before we launched the company, is who do we want to be as a brand? We wanted to be a reflection of our core values. We share how we recruit people and how we train people in order to create a great experience for our consumers.
The dispensary and the bud tenders are that moment of truth when a consumer walks in and asks for a product recommendation. We make sure we treat our dispensary partners with the care that they deserve and that we’re investing resources to train them and make it easy for them to do their job when they talk about Coda Signature. And we want to make sure that the end-consumer has the same experience every single time.
How does 2020 look for Coda Signature?
We’ve got some really exciting products that I can’t speak about quite yet which will be launched in 2020. We’ve been in-market about a month in California and the reception has been amazing. Our Fruit Notes, which we launched here in Colorado a few weeks ago, are flying off the shelf. We couldn’t be happier with how we’re doing. But, as a founder and a CEO, I sleep very little. I’m constantly thinking about the things that we should be doing better.
Make sure to check out Coda Signature by visiting www.CodaSignature.com. If you would like your dispensary to carry Coda Signature, make sure to leave them a message by Clicking Here