SPEAKER_01 0:00

I felt like, you know, cannabis has always belonged at music festivals. It's always been there. Um, but to have it in a regulated setting where people could could interact with the brand, I think everyone was was gravitating towards it. So that was just fun to fun to see.

Welcome And Ben’s Big News

AnnaRae Grabstein 0:34

Hey everybody, welcome to High Spirits. I'm Anna Ray Grabstein, and Ben, our favorite co-host, is away for fraternity leave. Um, best wishes to him and his family today. It's June 30th, 2026. It's episode 143, and today we're gonna be talking to Eddie Brennan, CEO of New York's Heirloom. Uh, but before that, we have an incredibly special news update today, and we're gonna be bringing on Laura Fogelman, Chief of Staff and Head of Strategic Communications at PAX, who was at yesterday's DEA hearing for day one, and she's gonna give us the juice. So um, without further ado, uh, let's bring on Laura.

SPEAKER_02 1:15

Hey Laura, welcome. Thank you for having me. Great to be here.

AnnaRae Grabstein 1:20

Yeah. So uh I just want to jump right in. Um, how the heck did you end up at this DEA hearing yesterday? And what was it like?

SPEAKER_02 1:30

Yeah, well, funny story. I'm actually not in Virginia for work. I have family here and we came out to celebrate the holiday next weekend. But when the hearing got scheduled, it just felt like too historic of a moment to pass up. And I, you know, wanted to be able to be in the room and just see firsthand how everything was unfold unfolding. So uh made the decision to show up at the DEA headquarters in Pentagon City yesterday a little earlier than the hearing was ready to start, anticipating a big crowd and was surprised to find a relatively small crowd, but uh a very interesting day of proceedings.

AnnaRae Grabstein 2:03

Tell us what Pentagon City is like.

SPEAKER_02 2:07

Well, you know, I didn't spend a lot of time uh poking around outside of the DEA kind of compound in and of itself, but I will say security is very tight, um, which was, you know, not unexpected for the DEA. I think there were about uh 25 of us total who showed up as observers and we were all waiting in line, starting at about 7:30 or 8 a.m. uh to be let in. They did a pretty intensive screening process. We had to go through metal detectors, and you know, they took our real IDs and ran background checks and then uh ultimately our badges very clearly noted. We required escorts throughout the building. So lots of security, you know, escorts, phones had to be turned off for the entirety of the hearing, which was, you know, big surprise for me. Um, but yeah, they're obviously taking this very seriously. I think I was the only person there, not in a navy blue suit, which was the uniform for the proceedings. Um, but yeah, definitely a really just uh formal vibe to the hearing.

AnnaRae Grabstein 3:07

Yeah. And it's notable that only 25 people were there because often a hearing like this would be live streamed and it wasn't. And so not only was it not live stream inaccessible to people um from home or from around the country and the world who were paying attention to this momentous moment, but there wasn't even recording allowed. So the notes that you shared with me and that we're gonna talk through, um you were taking those by hand, um, as were everyone else in the room, right? Yeah.

SPEAKER_02 3:35

And I will say I have so much respect for all the reporters out there who are expert at taking hand notes. I took about 20 pages of notes, as did almost every observer there. I think we were all trying to, you know, transcribe the conversation just to, you know, preserve our own record of what was discussed. Um but yeah, you know, I was a little bit surprised because in addition to not live streaming it, which I think is newsworthy in and of itself, you know, all of the kind of folks invited to participate were all, you know, opposition voices. And so I expected to see, you know, a big turnout just given the national interest in the issue. And certainly SSDP and some others, you know, had press conferences outside of the building, you know, early in the morning, but the actual attendance itself was a lot smaller than I thought. There were probably only 25 observers in total, uh, which was surprising. It's a big deal.

AnnaRae Grabstein 4:26

I think a lot of us have spent our careers fighting for reform and market access and would have liked to be there. And it's not easy to get to Arlington. And like you said, it's a holiday weekend. So it's it's a complicated time. But let's dive into what you what you saw, what you observed.

Getting Inside The DEA Hearing

AnnaRae Grabstein 4:43

And you shared two questions with me that was the lens that you were wearing going into the hearing. So why don't you tell us what those questions were and what you learned?

SPEAKER_02 4:53

Yeah, sure. And I think, you know, this is not going to sound dissimilar for most of the folks that are listening and from within the industry, but the two big questions I had going in and really wanted to get a lens on were, you know, how strongly the government was truly going to defend rescheduling and really position themselves as a proponent of the change. And then secondly, you know, what was the opposition strategy going to look like? Obviously, the way it's structured yesterday was the government day to present their case and the opposition kind of they each have scheduled days to make their own arguments, but they had the opportunity for cross-examination of government witnesses yesterday. And so I was really interested to kind of see what questions were going to come up and what they were really prioritizing. So that was what I was interested in going into it. And, you know, I'll say I thought the government started really strong. I uh was pleasantly surprised by uh the case that they made in their opening statements and how clearly and methodically and precisely they really uh laid out the scope of these hearings, um, but also really defined what was not under, you know, discussion or up for debate in this, which was, you know, everything from the fact that the OLC already ruled on the two-part test. And so that was not something that was, you know, to be litigated. The fact that they weren't advocating for legalization. They were literally there to demonstrate that there was a currently accepted medical use for cannabis, which therefore, you know, meant it could no longer be defined as Schedule One. So that was, you know, a really, I think, strong place to start. And then, you know, the the attorney for the DEA, Jim Schwartz, he had kind of an interesting moment toward the end of his opening remarks where he said, you know, we're not here to say cannabis isn't dangerous. All controlled substances are dangerous. We're here to weigh basically the benefits with the risk and make a scheduling recommendation. And that was really the crux of what everyone was there to discuss.

AnnaRae Grabstein 6:53

And so the DEA had an opening statement. Was there an opening statement from the opposition as well? No, they'll have the opportunity for that on their scheduled days to kind of make their arguments. Okay. And and how long did the opening statement last?

SPEAKER_02 7:08

They started at about 9:30 and went until about 10:45 with a 10-minute break in there. Um and then we actually had a long lunch. The uh opponents weren't ready to start their cross just yet. And so they um started at one and went basically from one until five, cross-examining the government's first witness.

AnnaRae Grabstein 7:29

Okay. And but did the cross-examine, the cross-examination started after the government was able to question the witness also?

SPEAKER_02 7:37

Or oh yeah, sorry. The government did their opening statement and then they brought on Dr. Chaparino, who was their first witness, and his testimony went until about 1045.

AnnaRae Grabstein 7:47

And I've I've read uh your notes and a few other folks' uh notes from some newsletters about what he said, and it sounds like he was really articulate and scientific. Tell us a little bit about what he had to say.

SPEAKER_02 8:01

Sure. Um Dr. Chapperino is a very credentialed, experienced uh leader within the FDA. He has a strong scientific background. He, you know, has a doctorate. He led the uh rescheduling exercise within FDA. So he has a lot of expertise specifically on the process that they undertook. I think it's important to note that he was there as a fact witness, not an expert witness. So um the FDA had basically authorized him to testify on three specific things. And anything outside of those things under his TUI letter was, you know, not fair game for the conversation. But um he basically took everyone through the journey of the 10 month evaluation that the FDA did. And he explained the process, all of the data inputs, how they made determinations about various things and ultimately what their findings were, all of which are, you know, in that report and recommendation. But um, you know, he was very, again, systematic in how he approached that. I found him to um, you know, answer the questions in a very unemotional, informative, solid way. He wasn't, you know, coming across as communicating any point of view of his own. He really was just, you know, educating everyone on what that 10 months journey had looked like.

AnnaRae Grabstein 9:26

Got it. And so I did receive some notes from Vicente Law Firm who also had a law clerk in the room that was taking notes. And um, their notes on uh Dr. Chaparino, they said um, a point at the center of the testimony, only a single currently accepted medical use is required for marijuana to come off subschedule one, and that the FDA analysis identified three, not one, qualifying conditions, and that those conditions are uh anorexia associated with a medical condition, nausea and vomiting, um, and pain. So it sounds like they basically are saying that we have gone far beyond the one medical uh use and we've identified multiple.

SPEAKER_02 10:07

Yeah. And he did a really good job too of of explaining, you know, the way that these medical programs are operating in the states, there are about 15 different indications that cannabis is actually being used for. And they chose seven of those and did a deep dive into it. And so when they came up with the three that they felt demonstrated medical use, they've they really had substantive evidence supporting those determinations.

FDA Testimony On Medical Use

AnnaRae Grabstein 10:30

Okay. Well, and so then what happened with the opposition? How did the opposition approach uh Dr. Chaparino? And what did you think of their arguments?

SPEAKER_02 10:40

Sure. So yesterday we heard from uh three different folks within the opposition. We heard from uh David Evans of Indasa, we heard from Reed Smith of the Tennessee Bureau of Investigation, and then we heard from Patrick Camille of uh DUID Victim Voices. Sam was also in the room. They're starting their cross, or it's probably completed by now, but they did their cross this morning. Um the three folks we heard from, all very different styles, all very different groups, uh, all very different issues were raised. David Evans, who went first, I think was the most colorful of all of them. Um, and ultimately, I think his view that he was communicating through his cross-examination was that he felt like the FDA, in his own words, had done a shoddy job and the whole thing should be thrown away. And so what he was trying to do in his cross was highlight things that he didn't feel were included in the consideration that should have been. So he brought up things like why didn't you look at pregnant women as, you know, a specific uh, you know, demographic here? And uh Dr. Chaparino's response was, well, we looked at the population in totality. And certainly pregnant women are part of that. But for the purpose of this, all we were trying to establish was a currently acceptable, accepted medical use. We weren't, you know, this isn't a new drug approval. We don't need to go through all the same processes that you do in that context. Um, so that was one thing he raised. You know, as the conversation unfolded, it did get a little bit heated at times. There were a lot of objections from the DEA around scope of the questioning. And so what was supposed to be a one-hour cross-examination ended up being a two-hour cross-examination because there was so much conversation and back and forth around objections. Um, you know, we did see the judge getting a little bit frustrated at times, feeling like he was being talked over or not heard. So, you know, ultimately I thought he did a really good job continuing to reground the conversation and what it was intended to be. Um, the second uh cross-examination with the Tennessee Bureau of Investigation was markedly different from the first. And he was actually much more focused on intoxicating hemp. If I were to kind of summarize the issue, he brought up a lot of questions that he was trying to understand around the nature of products that are out in the market and that he views as intoxicating or dangerous, that weren't actually the subject of the FDA's review and evaluation and trying to get clarity around that. Um, and then the third uh cross-examination, the DYD victims, this is probably one of the more impassioned, I would say, of the three, where um there was a lot of concern that, you know, in the last three years since the 2023 recommendation came out, um, there's been a lot of conversation in his environment with, you know, families of victims who have, you know, had tragic things happen and cannabis has had, you know, some sort of a role in the story. And so I think he was expressing a lot of concerns that those data sets had not been considered prior to the recommendation to reschedule cannabis. Um, you know, I wasn't surprised by any of it. I think for anyone who's been following the conversation, these were all of the concerns and objections that we often hear from, you know, opposition to reform. And so, you know, it was all, I think, pretty extensive.

Opposition Cross And Judge Dynamics

AnnaRae Grabstein 14:11

Yeah, it it actually is heartening to hear that the DEA was objecting, that that the judge was engaged, all of these things that really point to that this is actually a real process that's unfolding. And uh some of us in the industry have been really wondering like, is this going to be some sort of prohibition theater? And is the DEA going to actually stick up for um for schedule three after really being on the other side of the issue for the past 50 years? And what I'm hearing from you is that there's potentially some optimism that the industry can have um from what happened yesterday. Um, how are you thinking about it? I know I know you don't get to attend the rest of the days. Um, you'll probably be getting ready for 4th of July with the family, but uh was it was it useful to be there? And are you optimistic about where it's all going?

SPEAKER_02 15:03

Yeah, I I definitely left with a lot more optimism than I arrived with because to your point, I was really heartened to see. I mean, Lisa Mann from the DEA's office was practically on her feet the whole time objecting to many of the questions that were asked in cross. She um had a lot of concerns about things being outside of the scope of what Chaparino was allowed to testify on, and then also just the scope of the hearing. I will say for anyone who's been in the cannabis industry for a while, most of us are here because of how deeply we care about the movement and reform. And this is a historic moment, no matter how you look at it. And I wasn't able to attend, you know, the last round of of this hearing, but um it was it was actually really great to be in the room and just see, you know, this moment that we're in. And, you know, I'm really hopeful that we see a positive uh result coming out of these hearings and action the DEA takes from there.

AnnaRae Grabstein 15:57

Amazing. Thank you so much for sharing with us today. Um, it's been great to hear your perspective and firsthand account. I just I I feel very lucky uh to have had your voice today. So thank you so much. And I hope your prescription in DC is amazing.

SPEAKER_02 16:12

Appreciate it. Talk to you guys later.

AnnaRae Grabstein 16:16

Okay, guys, what'd you think? Um, that is incredible. So cool to hear that the DEA uh is objecting to the opposition and is actually putting a witness uh in front of the judge that has incredible, incredibly strong points to make. And um, yeah, I guess I guess I'm feeling feeling a lot better about this than I maybe was last week. Um we're gonna move into the next part of our show, and it's gonna be a whole new vibe.

Meet Eddie Brennan Of Heirloom

AnnaRae Grabstein 16:45

Um, we are going to be talking with Eddie Brennan. Eddie Brennan is part of a multi-generational New York Apple family over five generations in upstate New York. And under his leadership at Beacon Skiff, his family business, uh the company has expanded into hemp and cannabis and has really taken the New York cannabis, regulated cannabis market by storm. Um, and I'm really excited to bring on Eddie and talk about uh his incredible story and this business they're building in New York. Welcome, Eddie Brennan. Yeah, thank you for having me. Yeah. Did you did you stick around to hear about this DEA interview that we that we just had with Laura?

SPEAKER_01 17:25

I did. Sounds like exciting things on the horizon. So yeah, always always great to hear from somebody on the ground.

AnnaRae Grabstein 17:32

Totally. Um, well, really happy to have you here today. Um, we're big fans of Heirloom at High Spirits. We talked to uh Mac about over a year ago. And this in some ways is a revisiting of an old story that some of our listeners have heard, but the company has been through an incredible growth trajectory, and I'm really excited to um hear about it. But why don't you ground us and get us started with um some background about you and the family business and how you guys transitioned from Apples um into cannabis?

SPEAKER_01 18:03

Absolutely. So, yeah, we're a five-generation family business. So um, you know, Mac is the president of Heirloom and I'm the CEO and also president of Beacon Skiff. So I represent the fifth generation of our family business. So um, you know, what what I brought to the family business and our team brought to the family business is the cannabis side of the business, as long as the hard cider side of our business. But we're we're very proud to to be a thousand-aper apple orchard here in upstate New York. And, you know, we've we've gone through many challenges over the last 115 years. And, you know, this it's almost a statistical impossibility to make it to the fifth generation. So there's been had to been so much innovation and change over the years to get to this point. And just amazing to think of all the years that have gone by and just the boundaries we've we've had to push. And, you know, almost had a few extinction of events along the way.

AnnaRae Grabstein 18:58

Well, those extinction events seem like they're really far in the rearview mirror. Um, just uh before we uh went live this morning, I pulled a BDSA report on uh on how heirloom is doing in New York. And granted, this is retail data only from regulated cannabis. Uh, but in the last year, you guys did $75 million of retail sales in the state across over 4.4 million units. Uh how does that sound to you?

SPEAKER_01 19:26

Yeah, I can say we felt every one of those units. You know, I think the team, the team here has been working, you know, day and night to get to get those out. But but when you put that in in perspective, it really is uh amazing to think of of everything the team's accomplished. And and in conjunction with you know us being a top 10 hard cider brain nationally and everything going on on the other side of the roads, though, you know, there's there's so much, so much happening. And and we couldn't really couldn't do it unless there were unless there were really passionate leaders here who really cared about uh the vision of the company and trying to trying to push push it forward. So just just very exciting to see where we're at.

AnnaRae Grabstein 20:02

Well, so you mentioned you have a top 10 cider brand. So you guys are playing in both alcohol and cannabis. And it's interesting because alcohol has had its own struggles, the category in in some ways is is shrinking um while cannabis is growing. Um, but alcohol isn't faced with the same stigma um that that cannabis is. And you've been a pretty loud proponent for sticking up for cannabis while still um protecting the legacy and the origin of this old um old business that you have. Can you talk a little bit about that and what that's been like?

SPEAKER_01 20:37

Yeah, I mean, our journey into cannabis was very, very intentional. I mean, 1911 saved, well, we say 1911 saved the family farm. So we had a thousand acres of apple trees, and really selling apples to packing houses and grocery stores just unfortunately wasn't a profitable business anymore. Um, so we had to find a way to create a new revenue stream. And we went through two really tough winters, winters here that that turned into really challenging springs where we almost lost uh the family business in the early 2000s. Um, and 1911 and our journey into hard cider really gave us a vehicle to to be able to sell these apples to our hard cider company and actually uh keep the trees going. So, you know, 1911 was uh absolute necessity to keep the business going. And and then you can you can say we kind of bet the family farm then on cannabis, but you know, we it was a it was a calculated bet. We saw in the data what was happening in other states uh that had legalized uh cannabis, and we saw the um the direct uh decline of of what was happening in the alcohol business. So we we saw cannabis somewhat as a as a threat to our our growing hard cider business. Um and what we really loved about what we were seeing in the on the beverage side of the business specifically um was that uh cannabis beverages were being consumed at occasions that alcohol weren't always uh being consumed at. And so So that uh was very intriguing to us. And we studied the category and really saw what was what was happening in it, and it was just an intriguing uh way for us to jump into it. And we wanted to create, you know, control the supply chain like we did in the Apple business.

Vertical Integration From Orchard To THC

AnnaRae Grabstein 22:15

And so when you say control the supply chain, uh what does that mean to you guys today?

SPEAKER_01 22:20

Yeah, so in the uh in the hard cider business, yeah, we're completely vertically integrated. So we we grow the apples here, um, everything is harvested here. Uh, we were trimming the trees, pressing the apples here, and fermenting here. And cannabis gave us similar opportunity uh to control to control S supply chain. We started with hemp, um, growing several acres of hemp for three years. And we knew that if we could control that supply chain, um, we could create you know quality and consistent, consistent products. And so we learned that in the hard cider business that that consistency and quality meant something to customers. And you know, when we make hard cider here, not only are we using fresh apples, but we're actually picking the specific variety of apple that we're putting into every one of our hard ciders, whether it be a honeycrisp hard cider, it's going to be 100% honeycrisp apples uh or original, which is a which is a blend of uh four very specific varieties. So we saw an opportunity to be able to do that uh in the cannabis side uh as well. Uh and so today, you know, this week we're actually planting uh two acres of cannabis on our farm, and we'll control that that from planting all the way to finished product.

AnnaRae Grabstein 23:31

And so as you guys have expanded into cannabis, you really are known for beverage. Uh people know the heirloom brand for these delicious uh THC-infused ciders that you put out. And um you're number one as a THC beverage in the regulated market uh in New York. But you are also in the number one, number two, or number three spot in almost every other category. And vapes are your leading category. You're super high up in the rankings with gummies and pre-rolls and even tinctures, uh, which was interesting to see. And you clearly are an ambitious guy. You've taken this family business that was the legacy of apple farming, faced with challenges, figured out how to the cider business off the back of it, expanded into the regulated cannabis and into the hemp opportunity while the door was open, is open. Uh I can't imagine that New York is the end of your ambitions. Like, how are you seeing the rest of the market? So many companies, once they reach the scale that you guys have, or even at a quarter of your size, have decided to take on a multi-state approach and go into other markets. I imagine you must be thinking about that.

SPEAKER_01 24:46

Yeah, I mean, that's an interesting question. I mean, I think, you know, when when Mac and I were talking about this a year ago, our multi-stake strategy was really hemp hemp derived uh THC beverages. And we've seen the you know things changing uh regulatory-wise with that. Um shocker things are always changing in in this in this category. Um, but you know, I think getting to the to the scale we're at in New York, we want to be very intentional and careful to not just run out of New York State uh without a without a real plan. And I think, you know, as we talk about it as a team and as a as a leadership team today, we still think there's a lot of room for growth in New York State. There's there's a lot of room for us to continue to continue to go deep. Um, and we learned so many um lessons from the the alcohol business about distribution, about our supply chain, about how we manufacture and go to market. Um and I think Mac and the team have built a best in class sales team that really has has a great way of communicating um to the dispensary owners and also uh ultimately communicating with the customers. Um so we see, we see, you know, still one to three years of of great runway in New York State for us to continue, continue to grow. That that being said, I think us continuing to look outside of New York uh regionally is definitely something we're talking about. I don't know that we have a well built-out plan to roll that out today. Um, but but something we're we're definitely talking about. And if you'd asked me two or three years ago, I'd say, well, people don't really know, you know, people aren't going to know what heirloom is. They're not gonna care about it. But but today, uh, I think very differently about that. I think the name Heirloom means something to customers. And I know when they when they grab our products, not only are they trying it, but they're coming back, you know, week after week to purchase the products because I think uh, you know, it's it's safe cannabis, but also it's a lot of the products we're making are effect-based, and the customers are enjoying those effects. Uh and when we created Heirloom originally, we wanted to be a very approachable, approachable brand. I think so many customers who go into dispensary today are so overwhelmed when they walk into a store. We wanted to tell people exactly what it is when they're purchasing it, whether that be a vape or a beverage.

AnnaRae Grabstein 26:53

Yeah. So you had mentioned that you did a bunch of studying of data before you guys got into cannabis and that you also um visited other operators. I want to talk about that a little bit and what it meant to create sort of best in class um operation because you've talked a lot about the team behind you. Um, I have met on multiple occasions your COO, Brianna Cortez, who has an incredible background and seems like just a super impressive operator. Everyone from the team is just like focused on efficiency and quality. And I'm wondering where that comes from. Is it that you saw it in another company? Is it that you have a certain philosophy of the way that you're approaching it? Who do you think is doing it the best? And who are you guys trying to emulate um in your path to be a best in class operator?

SPEAKER_01 27:43

Yeah, I mean, I think that's that's a great question. I would say that Brianna and Mac Hugh were just incredible leaders and they have such great vision. Um, I would say we actually didn't learn specifically from the cannabis industry. I think when we got out and looked at operators in the cannabis industry, um we we learned that you know everybody was forced to operate within within their states. And with that, a lot of distribution challenges came up, a lot of supply chain risk uh came up. When we when we really started to to dive into into the space, we took a lot of lessons from the alcohol industry. And I think if you look at a lot of the team members currently at Heirloom, the majority of them aren't going to be transplants from the cannabis industry. They're gonna be uh people who worked at Anheuser Busch in a leadership role. They're gonna be somebody who maybe worked uh for for a CPG company, um, like a Procter and Gamble or one or one of the bigger, bigger companies. Um, because in those in those companies, you're forced to vision set and look ahead, um, but also uh looking at your your supply chain and understanding uh how to build a quality supply chain. And that always wasn't being done in the in the cannabis industry. I'll also say on the on the hard cider side of our business, we had 15 years uh to make mistakes and iterate and learn as a team. And a lot of the leadership team that's over at Heirloom today are people that were uh uh in our hard cider business on the beacon skip side, uh, who who got to uh cut their teeth over here. And when we built the original hard cider facility here, we made so many, so many mistakes. Uh we you know, we put the labeler uh after the bottle bottle filler and the labels didn't stick. I could think of 15 examples like that. So, you know, everything from our flavor development, Jan Faye, who's our head of beverage development here, uh sits over all of our company. So not only is he developing the heirloom beverages, but he traded every single 1911 beverage that's ever been produced here, uh, as well as heirloom. So a lot of a lot of crossover. And you know, I think ultimately it's all about quality and consistency. And that starts with the ingredients and then the people um that are that are making them on a daily basis. But the one word I think about when I think of our team is just just passionate, you know, passion. And that's something, something you can't teach. And that's ultimately what we what we look for here.

How Heirloom Builds New Products

AnnaRae Grabstein 30:07

Yeah. Well, so you mentioned Yan and you mentioned that you um have focused on creating a moods line uh with minor cannabinoids and terpenes. I'm wondering if you could talk us through what a new product process looks like at Heirloom. And if you guys uh if if that is something that is a repetitive process or it's different every time, um, how how something hits the market?

SPEAKER_01 30:30

Yeah, so originally, you know, five years ago, I would say the the product wasn't the process was not as as fleshed out as it is today. Um, there were a lot of close calls because we do testing with hen. Uh we weren't we weren't using THC at the time, so we'd we'd be using CBD. Uh I'll say I overdosed myself on C V D multiple occasions where I had over 100 milligrams and came back to my office sleepy. But today it's it's you know, we started on the hard cider side of our business and we do, you know, we did weekly tasting panels, and we always try to keep the the group consistent on who was tasting it. Uh and I go back to 12 years ago when we created uh 1911 cider donut, which is um one of the is our best-selling hard cider, seasonal hard cider today. And every hard cider company in the country now carries a cider donut. And back then, Jan Faye and I were we were just you know mixing things in the lab and trying trying to create the flavors. When I look back on that, we landed on something, um, but it was hard to figure out how we got there. And today we're much more intentional. Um, you know, if we're creating a new a new vape product or a new gummy, um, we're starting uh Jan's Jan and the team, everyone's creating the actual flavor, and then we actually we distribute it to our employees here. So we have a group of over 50 employees who get samples, and then we have a QR code um with a detailed questionnaire of exactly the things that you're tasting. And so, you know, we then meet after everybody's tried the products. So we try to have that consistent um feedback from our employees who we also see as our as our consumers uh on a daily basis. But yeah, it's it's uh it's certainly a fun process. And one, if you had told me we're gonna do 20 years ago, I would have should been shaken my head.

AnnaRae Grabstein 32:15

Yeah. When and you talked about the growth that you continue to believe is is in New York. What's your take on the state of the market in New York today? There's tons of brands. Um, as someone that came up in California cannabis myself, I look at what's happening in New York and I wonder how many of those brands will still be around in a couple years. Uh, what's what's your take on on how people are faring in in the state overall?

SPEAKER_01 32:43

Yeah, well, I'd say there's there's a lot of uh labels on the shelf in New York City. I'm not sure how many you know brands, brands there are necessarily. Um everybody wants to play in New York. And New York, I think one of the challenges for New York operators is everyone can come to New York and afford to lose money, right? Because you need to have a you need to plant your flag in New York State. You want to get in front of as many customers as you can. But I I think at times when you when you pull brands off the shelf, whether it be New York or other markets, um, the story behind those brands can be lacking. And you know, I think when you look at the the data, um, you know, we look at a little alerts or BDSA and look at the the brands that are winning in New York State, it's a lot of local New York brands. And I'm not sure how uh you know, I'm sure that happens in other other states as well, but it's been really amazing to see the New York brands uh winning on the shelf. And some of that is the way the regulatory was structured in New York, and they did a great job of setting up setting up the market. Um, but I think it is it's ch it's a challenging market to break into for sure. And we have a robust sales team, and and we're always out there, you know, building relationships with with the dispensaries. And you know, customers are customers are discerning, and I think more and more they're they're picking brands off the shelf, and they're they're actually want to see what the story is. And what's been really neat about Heirloom is like people actually connecting Heirloom to Beacon Stiff and then to 1911 making that that connection on well, I've tried this product, I've actually been to the farm, and maybe I've had a hard cider, and that's that has been that's been amazing.

Festivals And Marketing Under Restrictions

AnnaRae Grabstein 34:23

But how have you guys done that with with the with the restrictions on marketing? How how is that story filtering down?

SPEAKER_01 34:31

Yeah, I think it's it's more of an organic connection customers are making. Um, one one great um thing we just did recently was we had Heirloom at Governor's Law, which is a you know one of the music festivals in New York City that happened last month. And we were the first cannabis beverage or cannabis brand that had been featured at their music festival. And one of the coolest things we had we had the installation set up and just having customers come and interact with the brand and then actually be able to consume heirloom on site. And you know, we could only sell the one milligram beverage for the New York State regulations, but having people connect with it. I mean, I I felt like you know, cannabis has always belonged at music festivals, it's always been there. Um, but to have it in a regulated setting where people could could interact with the brand, I think everyone was was gravitating towards it. So that was just fun to fun to see. And and now I think people people put the pieces together. Or if you come to a a concert at Beacon Skiff, I think last week we had Dustin Lynch here for a country show. And you know, we have an heirloom um stand set up there, and so people can come come see the brand there and um and interact with our with our you know brand development team. So we try to meet customers in those moments where it's it's more of an organic feel that oh, I'm at an apple orchard, and of course cannabis belongs belongs here. So that's been fun.

AnnaRae Grabstein 35:55

In both of those um scenarios that you described, are those your hemp beverages that were being sold because you can't sell the regulated cannabis ones, right?

SPEAKER_01 36:06

Yeah, I mean that's um that is our hemp derived THC beverage. And New York, New York State's a little tricky because you can only go as high as one milligram. Um so so it's yeah, you're you know, you're gonna have to drink, you can have to drink a few of them to get to to get the feeling of a five or ten milligram beverage, but it's more a proof of concept and a way for us to just you know sample to customers on on here's what it tastes like, and then you know, we can point them in the direction of a dispensary

Hemp Beverage Uncertainty And Regulation

SPEAKER_01 36:32

down the road.

AnnaRae Grabstein 36:32

Well, you're kind of opening the door to to talk about hemp a little bit. And and I think it's interesting because there's so many hemp beverage brands right now that are really grappling with the future, not knowing what's going to happen, if the November ban is gonna hold or not. You guys have built a real business in regulated, both with beverage and other form factors. And I think that there are varying perspectives from the hemp beverage brands that I've spoken to about if there's really a business opportunity for them in regulated cannabis, because the dispensary is not necessarily the best channel to be um to be finding, acquiring these, these types of products. Um, but you guys are doing okay at it. And I'm wondering what your take is on that decision process for for these hemp beverage companies right now that aren't in regulated cannabis. Should they be looking at regulated cannabis? Any advice for those folks that are grappling with what to do next?

SPEAKER_01 37:32

Yeah, I mean, regulated cannabis is is so tricky. And that was the beauty of hemp hemp beverages, right? If you could ship it across state lines, you could anchor your manufacturing in one facility and then ship ship to multi to multi-states. And I think the challenge with retrenching and going to you know, back to the adult use market for these brands is you have to set up multiple, you have you have to build partnerships in each state with manufacturing facilities. And that would be a challenge. And I I totally agree with you. You know, dispensaries are not the best place for customers to be buying uh to be buying beverages. That being said, I I would say um what we've noticed in in dispensaries in New York is it's an incremental purchase, it's an add-on. Um, and dispensary owners are really open to carrying beverages because they they really see it as that. But you know, we we do have uh we did built a build a robust hemp business. Uh, we don't want to remember 13 states. And every week it seems, you know, even even before the the challenges that that are going to happen in November, you know, every every state it seems like it's just it's just whack-a-mole, you know, with different different regulations. But this is a tough moment, I think, for the for the hemp beverage industry. And you know, my take on it is whether or not it goes away in November, and I'm I'm becoming increasingly less optimistic. I think it's it's the cat's out of the bag, and and I'm hopeful that if it does come back, it comes back with real regulations. Um, that that's some type of a level playing field for everyone. Um, you know, I think these, you know, going into I was in a store in New Jersey last week, and there's you know 100 milligram beverages on the shelf. And I and and they not only are they on the shelf, but they're selling really well, and people are grabbing them. And so, you know, I wonder what will happen to those to those operators, because even in a New York regulated market, that's not a that's not a dosage that you can you can sell here. Um, so yeah, definitely, definitely tough. You know, I think when we built Heirloom originally, we built it as an adult used brand uh and then expanded into hemp to some degree. But the the core of our business was adult use, and it was a major risk to build, you know, uh a five plus million dollar canning line um without a license and anchor it in New York State with a conviction to believe that beverages did belong in adult use uh dispensers.

Leadership Strain And Family Legacy

AnnaRae Grabstein 39:51

Sure. Well, so within this just constant back and forth with regulations on hemp, and you've been navigating New York, which took years to work out what the market was going to look like, how the structure would work, from a leadership perspective, as you've been navigating, growing this business, kind of figuring out how to execute on your own ambitions and aspirations, what have been some of the biggest leadership struggles that you've had on that journey?

SPEAKER_01 40:19

Um, I think when you look at a a business that went from zero to you know $75 million at retail, happening in in a three to four year uh window, and then you contrast that with our beacon skiff 1911 business that you know we're in our 115th year, uh and heirloom this year will do um you know 30% more in sales, 30%, at least 30% more in sales um than our that business, it really puts it in perspective. And so many, so many of those uh step-ups in revenue uh you break things things break, uh whether it's within your manufacturing facility or or growing with people. Um, you know, Mac, I would say Mac and Brown and the team have done such a great job uh just challenging the status quo and continuing to look outside the outside the company to bring in best in class leaders, and they've done such a good good job at that. But uh it's the other the other major challenge is you know, we had to set everyone up as a separate company on our farm. Um so we literally from like selling the parcel of land it operates on all the way to um you know building it as a separate entity. Uh that's been that's been a real challenge to make sure we keep everything, everything, everything clean, separate employees, separate, separate bank accounts. Um, and that has uh you know created some challenges at times with the with the teams. Um, but I'm I'm ultimately just really, really proud of what everybody's accomplished in just challenging the continuing to challenge the status quo and make sure that you know we're we're continuing to uh look at ways that we could go out of business and then push back against that and find ways for us to to survive and and ultimately um try to find a way to a sixth generation.

AnnaRae Grabstein 42:12

Yeah, I I was thinking about that as as you were talking. You mentioned the big investment that you made um in the bottling line and the canning line. Um and I know that that was funded um by the company itself, not not a lot of outside investors. A lot of cannabis companies have these big aspirations of public market listings. Every day we're hearing about a new company that's working to try to uplist onto an American exchange. Um, there's so much MA that's going on in 2026 as a result of this maturation of the industry. Uh, what is what is the long vision here? What are you are you trying to build this for the family? Do you see something beyond that?

SPEAKER_01 42:55

Yeah, and that's a that's a great question. Um, you know, I when I look at the the businesses here, I see I see everything as one, even though is separate. Um and you know, when you when you live and and grow up on a on a thousand aprle orchard, it comes with a lot of responsibility. And when you're ultimately the the fifth generation leader of that business, uh you you have to make some uh you have to look out ahead to to see what the future can bring in today. I think that six, that potential sixth generation is is young, you know, that my daughters are 10 and 12. Um, but I I feel a lot of responsibility uh to lead and ultimately uh make my grandparents uh who are no longer alive, you know, proud of what the legacy of our of our business can be. And I think a lot of business leaders are you know aren't in that in that position. I had two really incredible grandfathers. I had Marshall Skiff, who you know worked on the land here at Beacon Skiff. He was our third generation leader, loved the apple trees. Um he actually called uh weed evil weed at times because I think he he. didn't uh he didn't understand the benefits of it. Um and then I had another grandfather, um, Ed Brennan, who I'm named after, and he's my my was my dad's father, and he ran Sears in the 90s. So he was uh you know a visionary in the retail in the retail landscape. So I learned so much from both of them, but ultimately I represent my grandpa Stiff's uh legacy here at Beacon Skiff. And so I'm so so proud. And that comes with a lot of uh you know challenges. You know, we when I got here, I realized that the apple trees weren't going to sustain our business. And so it it it's called for some challenges, but you know, heirloom I see as this amazing growth vehicle. Uh but you know, I think ultimately, you know, down the road, who know who knows what will what will happen. Uh, but today we're we're trying to build it for that next generation and trying to continue the the legacy here. Awesome.

AnnaRae Grabstein 44:52

Um are there any big hairy aspirations that we haven't talked about, things that you're excited about in the coming year?

SPEAKER_01 45:01

Yeah, well, I couldn't be more excited uh about cannabis beverage. And I know everybody gets excited about cannabis, cannabis beverages, and I think we're in a in a bit of a challenging moment right now with the category and a lot of uncertainty. Uh, and I'd just like to say that I think ultimately this is all gonna get gonna get worked out. And I know you'd say, oh, that's easy for you to say you're uh the leading brand in New York and you understand your distribution, you have your brand so um you know, I think a customers, the the one thing I see today is is customers aren't aware about what's about to happen. And the customers love the category. And the the the great thing I've seen with cannabis beverages is um, you know, whether it's my mom or someone's grandma uh drinking it or a cancer patient drinking it, so many, it's just such just this wide scope of people. Uh and cannabis is the great uh destigmatizer in our industry. And I and I really believe that that cannabis, more than any other form factor, is the one that that is going to continue to push the category forward. And I think it has in a lot of ways. I just think we've gotten into this clouded environment um where you know people have have maybe pushed it a little too far, and the lack of regulation has created a lot of um a lot of uncertainty. So, but I I remain very hopeful that uh you know, big alcohol has taken notice as a as a a large alcohol um operator in New York State. I can tell you they have because I I go to the Brewers Association meetings and the Cider Association meetings, and it's a major topic. You know, everybody's talking about either they want to get into the category or they want to understand what's happening um in the categories. So very, very optimistic. What it looks like in the future, I can't tell you, but I know ultimately if there's a poll from consumers, we'll figure it out.

AnnaRae Grabstein 46:50

That is hopeful. I like

Final Advice And Listener Sendoff

AnnaRae Grabstein 46:52

it. Uh well, Eddie, I think it's time for our last call. Um, and that's our final message for our listeners. Advice, call to action, or closing thought.

SPEAKER_01 47:02

Well, I think, you know, today uh people get very caught up in in the regulatory landscape and things changing, changing on a daily basis. I kind of come at things from a different perspective. You know, we're we're at we're an operator here who has uh been forced to change uh for our business to survive. And what that's allowed us to do is be laser focused on what what matters. And for us, what matters is the preservation of our land here and making sure uh everything we produce is quality and consistency. And I think if everybody would make sure everything they're making focuses on that quality and consistency, uh, you know, the consumer will win and ultimately that's uh let's win up for sure in industry forward.

AnnaRae Grabstein 47:48

Awesome. Thank you so much for being here today and and sharing your story. It's really, really cool to hear about what Heirloom is up to.

SPEAKER_01 47:55

Yeah, thanks for the opportunity.

AnnaRae Grabstein 47:57

Yeah, thank you so much. What'd you think, folks? Um, pretty cool what Heirloom is doing. I think you can go and um check out the farm in upstate New York. They've got concerts and stuff all summer. Uh, definitely try to get there. It's far, but I think it might be worth it. But uh thank you to our teams at Vertosa and Wolfmeyer and to our producer Eric Rossetti, and tons of love to Ben and his family as they're going through this sweet time with the brand new baby at home. Um, if you enjoyed this episode, please share, like, review, do all the things wherever you listen to podcasts. And thank you for listening. As always, folks, stay curious, stay informed, and most importantly, keep your spirits high. That's our show.