Herbl Inc. CEO Mike Beaudry certainly knows the cannabis business as founder of the California-based distributor that provides marijuana to more than a thousand legal businesses in the state.
While California supports the largest adult-use cannabis market in the U.S., it continues to face off against legacy — or illicit market — sellers as consumers shop on price rather than paying more for products from the regulated, legal market.
For Beaudry, the company’s strong ties to the illicit market remain a source of value, however. Beaudry said cannabis has been in his life since he was a teenager, and the company counts a significant number of employees that have been part of the cannabis business for decades.
“Herbl’s north star is a professional supply chain with a constant dose of legacy influence,” Beaudry said in an internal interview that the company shared with MarketWatch.
When he founded Herbl in 2016, Beaudry brought to bear his experience as president of United Natural Foods Inc.
from 1999 to 2010, during a time of explosive growth at the company. He was also CEO of Lang Pharma Nutrition from 2010 to 2016.
Beaudry launched Herbl six years ago partly because of his ties to the plant, but he also wanted to weave in his logistical prowess into the legal business.
“I felt that with a legacy industry changing to a more traditional supply chain, my background would be well-suited to be part of the movement and be a part of helping shape the new legal framework…,” Beaudry said.
Herbl, which is backed by private equity firm Salveo Capital, currently delivers to more than 1,000 licensed cannabis retailers in California. An Herbl spokesperson did not comment on an inquiry from MarketWatch about the number of employees or revenue at the company.
While California offers the largest legal cannabis market in the U.S., it’s also a competitive and difficult place to do business, Beaudry said.
“We still see some of the same challenges and hurdles we faced four years ago when we started,” Beaudry said. “Brands still experience the challenges of an oversaturated and volatile market, retailers still work with countless suppliers, further fragmenting their supply chains, (and) taxes and the unregulated market impact the whole chain.”
Meanwhile, the California market continues to evolve.
MJBiz reported Tuesday that up to 150 new retail licenses may be awarded in California as more than two dozen California cities and counties hold ballot measures this November to open up new recreational marijuana markets.