Keef Cola is one of the 10 products that CBE recommended last May when we published our first Edibles Hot List.

Finally, five months later, we were able to track down the elusive Knutson brothers to learn more about the producer and processor of one of Colorado’s favorite infused drinks, as well of a variety of other infused products serving the medical and recreational markets in Colorado.

The brothers, Kelly and Erik, also own Isolate Extraction Systems, LLC (see Part 2) and are currently expanding both businesses outside the State of Colorado.

Erik and his immediate family have, at one time or another, been pioneers in the Colorado green rush. Under their state manufacturer of infused products (MIP) license, Denver Packaging Company, Erik (and his friends and family) manufacture the Keef Cola line, currently distributed to over 380 dispensaries in Colorado.

In addition to Keef Cola, they also process and market Oil Stix, their raw CO2 extracted cannabis and terpene oil launched in 2012, as well as a line of vape pens that hit the Colorado market in the summer of 2014. They are currently in the process of launching the Vitacanna line of high CBD-THC infused products in Colorado, with plans to go national sometime in the not too distant future.

With all of this going on, one would think that the family was rolling in the dough. Although, they are now beginning to hit stride on their plan to have their brands distributed in every dispensary in Colorado (and eventually nationwide), a number of partnerships gone wrong and bureaucratic regulatory issues have slowed their progress until recently.

Born and raised in Boulder, the boys and their younger sister attended Boulder and Fairview High Schools before finding their way into their respective callings. Erik, the oldest of the three brothers, joined the family construction and real estate business after high school and worked at it through earning his business degree from the University of Colorado.

Erik Knutson

When the recession hit, spurred on by the collapse of the real estate housing market that made it difficult to earn a living in the family trade, he began exploring opportunities in the emerging Cannabis Industry. He now serves as Founder and CEO of CanCore and Denver Packaging, which are the respective production and licensing arms of the various product lines. Scot Knutson, their chief operating officer, is a decorated retired Marine who served as an Explosive Ordinance Disposal technician in Iraq and Afghanistan before being honorably discharged.

Kelly, who at 30 is the youngest, worked in the construction side of the family business with a specialty in welding and project management now serves as the CEO of Isolated Extraction. And their Dad, an Aerospace Engineer by training, runs operations for their Native Hemp Corp another of the new cannabis and hemp businesses.

On their mom’s side, their grandfather, who was a decorated veteran of the Battle of the Bulge, represented the white-collar, entrepreneurial half of the family. He founded one of the country’s largest greeting card manufacturers following his service in WWII that still employs over 200 people in Boulder today. Growing up, all of the boys were active. Kelly loved dirt biking, and Erik lacrosse, which banged them up enough to keep them from following family tradition and Scot into the U.S. military.

Erik received his medical card in 2009, and by the end of the year, launched a retail dispensary — Specialty Health Services, LLC (currently in operation and under new ownership as Green Dream Health Services). With vertical integration on the horizon, he decided to move away from the dispensary business and into the manufacturing arena. Keef Cola was launched in January of 2010 out of his and his brother’s kitchen.

By March, they invested in and moved into a commercial kitchen in Weld County, only to experience their first negative regulatory experience. Four months after opening, they were shut down and forced to look for another location due to a moratorium initiated by the County Commissioners

They found a great location in Boulder, complete with clean rooms, and again built out the space which Keef Cola operated in from July of 2010 until Denver decided to ban products not produced in the city in late 2011. By November of 2011, they had relocated to a facility in Denver, and the business took off as Keef gained wide distribution in Colorado.

They saw sales zoom from $30k a month to around $150k within six months. However, once again the clouds turned gray as the producer that they had licensed the Keef Cola brand to (Erik and his brothers owned the IP and sales and marketing rights) was engaging in unsavory business practices, so Keef moved on.

They completed the build out of a second facility in Denver in September 2012, and by the end of their first 12 months of operation, they had built medical sales back up to $150k a month as well as helping Bhang Chocolate launch in Colorado and win the first U.S. High Times Cannabis Cup in April 2013.

As 2013 came to a close, their licensee decided to sell the licensed dispensary, cultivation(s) and manufacturing concerns out from under the brothers, which again forced the family to raise capital and finally launch their own manufacturing and processing (MIP) company to control their own destiny. The Denver Packaging Company was founded in September 2013 and this time the family owned not only the IP, sales and marketing rights, but also the processing licenses.

In April 2015, the Keef Cola “Bubba Kush Rootbeer” took first place at the U.S. High Times Cannabis Cup for best edible, beating out over 80 other entrants from a number of states. By August 2015, the company has seen revenues mushroom to over a half a million a month and plans are shaping up to raise additional capital to finance expansion in state and into other legal states!

As they say, if at first you don’t succeed, try, try again — and the Knutson brothers and friends have done exactly that.

Background Information

Company Name: CanCore Concepts, Inc. and Denver Packaging Company

Year Founded: 2014 and 2013 respectively

Ownership structure/operating entities: Keef Cola, Denver Packaging Company, Oil Stix, Vape Pens, VitaCanna, Isolate Extraction Systems, LLC

Management Team: Erik Knutson, Aubrey Additon (CFO); Scot Knutson (COO); Andrew Veron (VP of Sales)

Headquarters: Superior, Colorado

Website: KeefCola.com

Industry Segment/Category: Producer, Processor and Consulting

Current Markets/States Served: Colorado

Current Number of employees: 20

Market Strategy/Goal: To develop the finest IP in the Cannabis space and provide world-class manufacturing consulting to potential applicants across the globe.

Product Mix: Keef Cola, Oil Stix, Vape pens, Vitacanna

Expansion Plans: Licensed in Oregon with Urban Pharms (production of Keef Cola expected to begin Q1 2016). Nevada, California, and Arizona by Q4 2016.

Financing strategy: Privately held