Formed in 2009, Native Roots is one of Colorado’s most recognized marijuana dispensary chains and vertically integrated Producer/Processors with 17 locations throughout the state. Led by owner and CEO Josh Ginsberg, the company has exploded onto the scene in the last two and a half years growing to over 600 employees while rivaling CBE’s top rated PPR (LivWell Enlightened Health), surpassing its footprint in the state and potentially revenue in that short period of time.
CBE caught up with Josh last week and wanted to share the story about how the company has become one of the largest licensed cannabis companies in the world.
Originally from Steamboat Springs, CO, Josh tells CBE that he headed east to the Big Apple to seek his fortune with JP Morgan where he secured a spot in their training program. After a short stint on Wall Street, he decided that the job and the city wasn’t for him. He moved back to the Rocky Mountain state and Boulder to find his fortune.
The aspiring entrepreneur started a few businesses in the automobile industry, including a dealership and detailing business that grew over time. It helped him establish a line of credit, which positioned Josh to stick his toe into the emerging medical marijuana business in the state. Both of his parents used cannabis to relieve the side effects of the chemo treatments for cancer, which helped him decide to enter the fray. In 2009, he cashed out of the car sale business and dove in.
Josh had a friend in the business—future business partner, Rhett Jordan. Rhett began his cannabis career by growing plants in his garage and for his caregiver customers. Josh self-financed a 5,000 square foot grow between 2009 and 2010 and proceeded to go through four master growers/gardeners (all of whom turned out to be too inexperienced to scale from a garden to a commercial grow). He scraped capital together by selling everything he owned, including his car, to make modifications to meet each growers needs.
During the first year of operation, Josh estimates that his grow only generated $17,000 from the one harvestable crop that they managed, and he nearly went bankrupt chasing his vision. In September 2010, he hired his fifth grower and was eventually able to turn the cultivation and business around.
It couldn’t have occurred at a better time! Colorado implemented forced vertical integration where dispensaries had to grow at least 70% of what they sell and 30% could come from an outside source. Josh’s fledgling cultivation operation partnered with Kind Love to distribute his product to medical consumers. Like many forced marriages in the early days of the Colorado medical marijuana industry, the partnership didn’t last, and they parted ways after 6 months. Josh’s wife Lauren Ginsberg jumped on the phone looking for retailers looking to sell, and they found The Dandelion as a willing retailer in Boulder. In 2011 they bought the cultivation operation as well to supplement their inventory and to meet demand.
With Lauren running the retail customers side of the operation and Josh running the cultivation side, The Dandelion operation prospered. Their friend Rhett took notice and broached the subject of merging, which Lauren mandated could only occur when the two businesses were of equal size. Conversations continued for a couple of years until an agreement was reached which combined the Dandelion Boulder location and grow with Jordan’s Native Roots Denver location, potential lease at the last Vail location on the “Green Mile,” his garden, as well his Manufacturer of Infused Product (MIP) license. And of course, the only part resembling the early years, the name Native Roots.
In June 2013, the new Native Roots (NR) partnership was formed and by the end of the year, the partners were in discussion with Peter Knoebel, owner of Solaris, a Vail, Colorado Development and Real Estate company and former telecom executive. In 2014, a new partnership was formed with Knoebel as the Real Estate arm, reportedly owning half of the company, and Ginsberg and Jordan each own a quarter.
Coinciding with the rise of Adult-Use marijuana legalization, and with the real estate expertise of Knoebel and cash-flow from operations supplying the capital (and the Ginsberg’s continuing to run day to day operations). The new partnership has seen meteoric growth over the past two years. Their first recreational facility opened in July 2014. And, according to records, the company owns more marijuana business licenses (84) than any other group in the state.
In addition to 17 locations (The Dandelion and 16 Native Roots branded sites), Native Roots boasts multiple grows, and arguably the largest indoor state of the art cannabis facility in the state. Along the way, they added talent that Josh acknowledges they couldn’t have accomplished as much without—including building their processing operation and Native Roots Extracts, which accounts for approximately 30% of their revenue and Native Roots grown flower contributes to 40% of revenue.
Currently, Native Roots sells third party edibles. The majority of these are supplied by notable state companies like Incredibles, Keef Cola, Love’s Oven, Sweet Grass Kitchens, Wana Brands, and Mary’s Medicinals.
Lauren has been the driver behind the Native Roots experience and brand, while creating a consistent atmosphere for both medical and adult-use customers alike. It is seamless from one location to the next.
One of Native Roots best practices includes staff education and cannabis knowledge. They have an exhaustive training program that all of the budtenders go through. As a result, Native Roots budtenders are informed, trusted, and educated advocates for cannabis in the industry. They contribute to Native Roots’ goal to change the perception of marijuana and its consumption. They showcase the medicinal benefits of the cannabis plant as well as the ways cannabis can assist in daily life as an alternative medicine.
Josh tells CBE that Native Roots is not finished building its Colorado footprint and expects to add many more locations in the state over the next few years. There are no immediate plans to move into other states, but you never know when opportunity will present itself. After all, who would have expected back in 2009 as Josh was struggling to survive that cannabis consumers would equate “Hip, Cool & Fresh” with Native Roots as they do now!
Company Name: Native Roots
Year Founded: 2009
Ownership structure/operating entities: Privately owned
Management Team: Josh Ginsberg, Co-Founder, CEO and Owner; Ryan Brown, CRO (Chief Revenue Officer); Lauren Ginsberg, CRO (Chief Retail Officer); Jon Boord, General Council; Dave Questa, Compliance
Headquarters: Denver, CO
Industry Segment/Category: Medical and Recreational retail stores and suppliers. Vertically integrated.
Current Markets/States Served: Colorado
Current Number of employees: 600+
Market Strategy/Goal: To offer the best marijuana purchasing experience in Colorado, and the be best known brand in the state.
2015 Revenues: N/A
2016 Projected Revenues: N/A
Expansion Plans: Continue to expand Colorado retail operations
Financing strategy: Cash Flow from Operations
Rob Meagher, CBE’s Founder, President and Editor-in-Chief is a 30 year veteran of the media world. His career has spanned from stints representing the Washington Post, USA Weekend, Reader’s Digest, Financial World & Corporate Finance to the technology world where he worked at International Data Group and Ziff Davis where he was part of the launch team for The Web Magazine, Yahoo Internet Life, Smart Business and Expedia Travels before starting his own marketing and Publisher’s Representative Firm. He also ran all print and online media sales and marketing for the Society for Human Resource Management before partnering with Forbes and then Fortune to create Special Sections covering a variety of topics. Rob, who started CBE Press in 2014, can be contacted at [email protected]
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