‘If your direction from the start isn’t to be different or unique, you’re wasting your time.’ – Trent Kitsch, CEO of DOJA.
There are currently zero established brands in the emerging multi billion dollar a year cannabis industry. Many companies have big projections and bright presentations showing how they will gain market share in this new and exciting industry. But, after seeing repetitive designs with portmanteau medicinal sounding names, it’s clear that a lot of these brands are a copy of a copy of a copy.
But then there’s DOJA & Tokyo Smoke. Instantly they look different. It’s immediately clear that they plan to disrupt the sector with how they present themselves.They use black and white, red and white, filtered photography and modern fonts and logos that don’t in any way look like or resemble 1990’s Advil or Tylenol, a look that currently dominates the sector. And best of all, this isn’t some obscure display happening in the backdrop that no one is paying attention to; people are talking. Important people like those at cannabis giant Aphria who are invested in the vision that these two brands have for the future who will operate under the brand Hiku.
Alan Gertner, CEO of Tokyo Smoke
Alan Gertner, CEO of Tokyo Smoke told me today, ‘With legal cannabis there is a unique and new opportunity to establish brands that will stick with people for life.’
So, how are these sought after brands created?
Disruption. A changing in the status quo, a unique and innovative idea. Trent Kitsch has done this before. He is the original founder and CEO of Saxx, an underwear company that took market share away from some the biggest companies in the sector who seemed untouchable at the time. He created a unique lifestyle brand that stood out, just like DOJA is doing now. He sold SAXX and shifted his focus towards wine and cannabis, becoming the CEO of both Kitsch Wines and DOJA.
Hippy Shit fragrance by Mister Green
Alan Gertner has impressive background as well. He worked on Google’s business development team for 6 years and comes from a family of entrepreneurs. He is now the CEO of Tokyo Smoke with 6 going on 7 locations in Canada and the US. Tokyo Smoke has developed an array of products ranging from coffee to fragrances to clothing, and of course nearly every cannabis related product you could think of. With Tokyo Smoke’s focus on being a lifestyle brand, I believe they could be the Stussy of the cannabis sector.
I sat down with both Trent and Alan in Vancouver to discuss the past, present and future of their businesses.
Taylor (High Energy Trading) : There’s been so many mergers and acquisitions in the cannabis sector over the last few months. Sometimes it feels inauthentic, or just purely about money and leverage. But, when I first heard about DOJA & Tokyo Smoke coming together as Hiku it felt different because I have noticed many similarities between the companies. Not only on the focus of being a lifestyle brand with well thought out and compelling design, but about you two as individuals as well. Trent you started Saxx, an underwear company. Alan, your Grandfather started Mister Leonard, a sportswear company. You both come from a family of entrepreneurs. Trent you own Kitsch wines, Alan you’ve developed 4 lines of coffee for Tokyo Smoke, now you both own and run cannabis companies who have coffee shops. What other similarities do you two have?
Alan (Tokyo Smoke) : The underwear and sportswear, I hadn’t made that connection until now! But, yes we are both dedicated to creating quality lifestyle brands. We have a very similar vision for the future of Hiku. With legal cannabis there is a unique and new opportunity to establish brands that will stick with people for life.
Taylor: The thing that stands out to me the most about DOJA and Tokyo Smoke is the design, who will be responsible for Hiku’s design moving forward?
Alan: We have a creative team, but we tend to work collaboratively whether it’s Trent, Ryan or I who are truly co-founders of Hiku, together we have such an aligned vision and shared goals. The process of designing something comes from the team and about an outcome that we can all believe in.
Taylor: Aphria has made a large investment in this deal. What will their role be in the future of Hiku?
Alan: They are an investor, and a future supplier.
Taylor: Trent, DOJA has been extremely successful so far. Since going public in spring of last year, DOJA’s stock has increased by nearly 600%. Your financials look healthy, you also have a very low debt/equity ratio of 0.09, according to Morningstar. You also haven’t been diluting shares like other companies in the sector by doing massive convertible debenture deals. I’ve also read that you are expanding your production capabilities. Why should investors continue to invest after such a monumental run?
Trent (DOJA) : We plan to keep working to beat the competition and to create the best quality products. We are disrupting the market, before I started Saxx they didn’t have underwear in skate shops and at golf courses, the industry had huge name brands that we took market share away from because we were unique. With DOJA we are doing the same thing, building a unique lifestyle brand. And we are already part of the subculture, hundreds of thousands of people are following what we are doing and we have been in the cannabis culture for over a decade, a lot of companies have come to the inauthentically and we think people will see that. And yes, we are also expanding to produce over 5,000 kg’s annually.
Taylor: You also have the culture cafe, how much cannabis do you expect to see moving through there annually?
Trent: Once we receive our sales license we expect to see around 1,000 kg’s being sold in the cafe per year.
DOJA Culture Coffee Shop, Kelowna, BC
Taylor: You also own Kitsch Wines in Kelowna, do you see that being a unique advantage? The tourism industry in Kelowna is massive.
Trent: Yes, it connects us to the tourism industry. Kitsch wines and DOJA are completely separate, but it does help in spreading awareness of our brand. With Kitsch wines we have a lot people coming through and they are always asking what we are up to, we plan on directing many people to the cafe through that. Also, our facility FUTURE LAB is right next to Highway 97 in Kelowna, so thousands of people everyday are seeing our brand displayed there, and thousands of people walk by the culture cafe everyday as well.
Taylor: I’ve brought something for you, this is Purple Cow by Seth Godin. It makes sense to me that this was your favourite book as many principles in it shed light onto DOJA’s approach.
Trent: Totally! This is my favourite book!
Taylor: Especially the idea of ‘crossing the chasm’. I think both DOJA and Tokyo Smoke have executed on this better than anyone, you get the early adopters and innovators first, and then the idea gets ‘sneezed’ on to the minority, majority and eventually the legguards. Many companies try to capture huge segments of the market and never catch on.
Trent: Seth Godin replies to my emails sometimes I feel so honoured to have his ear and I think he’s one of the best marketers in the world today. I really like reading and learning from others who have done it before me.
Trent: Let’s explain what purple cow means. If you’re driving and there’s 99 regular cows and 1 purple cow, you’re definitely going to be interested and curious about the purple cow, this unique thing. His message is don’t even get started if you’re not a purple cow, the world doesn’t need another Advil, if your direction from the start isn’t to be different or unique, you’re wasting your time.
Tokyo Smoke cafe – Assembly Chef’s Hall, Toronto, Ontario
Taylor: Yes, the risky thing to do is to be like everyone else, to be safe and not stand out. I see a lot companies in the sector with very similar and repetitive branding, and not a lot have focused on the lifestyle aspect that DOJA and Tokyo Smoke have. Why is that?
Trent: I think you’re seeing a lot of people coming into the space inauthentically, for 50-75% of it, they don’t have access to the subculture which will become the culture, they don’t know what DOJA means. Companies are just pieces of paper and pens but the people are what makes it happen, it’s all about the people and we are just trying to be ourselves. We have been in the cannabis culture for de
cades and we love consumer packaged goods, design and quality so we are weaving that fabric and using all those colours to paint our picture.
Taylor: So I have to ask, with your ownership of Kitsch wines, and Alan, with your line of coffee products, can consumers expect to see cannabis infused wine or cannabis infused coffee in the future?
Alan: As you know currently that is illegal, both cannabis and alcohol mixed as well as cannabis mixed with coffee, but, for the future we always plan on creating quality products.
Trent: Yeah, I can’t give away all my gems.
We believe there is a lot room for many companies to succeed in this space, cannabis is going to be a lot like alcohol. There will be the mass consumption brands that people buy because they’re cheap and readily available. But there will also be the Grey Goose’s and Patron’s that grab attention through quality, reputation and uniqueness in an extremely competitive market.
Related From High Energy Trading:
- Craft cannabis grower and cannabis lifestyle brand founded in 2014
- Operations located in Kelowna, BC
- Licensed producer under the ACMPR, anticipating sales license in Q1 2018
- Current production capacity of 660kg/yr, growing to >5,000kg/yr in 2018
- One Culture Café located in Kelowna
About Tokyo Smoke
- Leading Canadian cannabis lifestyle and retail brand founded in 2014
- Headquarters in Toronto, ON
- Six Tokyo Smoke coffee & head shops
- Licensing agreements for branded cannabis products with Aphria & WeedMD
- Growing portfolio of widely recognized cannabis brands