🎙️ Kiva Confections, Co-Founder, Kristi Palmer
Kiva (chocolates, mints, chews, gummies) was founded in 2010 and is currently available in 9 States (CA, AZ, NV, MI, IL, OH, OK, MA, HI) and Canada.
📢 *** I’ll be at MJ Unpacked and the CLIO Cannabis Awards (250+ attendees are expected) next week (Sept. 28-30). Please note that while both are at the MGM Grand, they require separate tickets. I’ll also be hosting a gathering at the MGM Grand on Sept. 28th so let me know if you’re interested in connecting with other readers and friends of the newsletter.***
Kiva won a Grand Clio in 2020 for launching a limited-edition, fast-acting cannabis-infused turkey gravy for Thanksgiving 2019 and a Silver Clio in 2021 for their Lost Farm by Kiva Social Media campaign.
👩🦰 Background. Kristi started Kiva Confections along with her husband, Scott Palmer, in her San Leandro family home after taking over the backyard garden shed and turning it into a grow shed in 2008, starting Kiva two years later in 2010. Kristi and Scott weren’t seeing the product quality they wanted in dispensaries and set out to create a product that they wanted for themselves and their friends—a 60mg chocolate bar that was launched to market in December 2010. They continued to grow and innovate on new products and have five different product lines: chocolate bars, mints, terra bites, camino gummies, lost farm gummies and chews. Kristi grew up around Cannabis, where her dad consumed openly in the household.
📸 Photography ➡️ Cannabis. Being young and with spare time, they thought growing Cannabis would be a fun idea. Her photography background came in handy as they studyied commercial photography—selling images to people—which helped with learning about the creative process and making attractive, beautiful things which speak to people. This informed what the first version of the chocolate bar looks like and not much has changed since.
🚗 Why Distribution? When they first started in the Cannabis industry, Kristi & Scott started with clones (before chocolate bars), working with 40-60 dispensaries, which they flipped from purchasing clones to chocolate bars. One of the key ingredients to Kiva’s success has been distribution, which helps ensure consistent availability on shelves. Kristi believes Kiva and Kiva Sales & Service portfolio companies (Jetty Extracts, Cann, Autumn Brands, Level, Pacific Stone, Pure Beauty, Old Pal, etc) are stronger together, offering a comprehensive portfolio and providing dispensaries with stuff they will love vs. testing product and seeing if they’ll work.
⚖️ Accounts Receivable (AR). AR balances are continuing to rise and naturally, everyone in the supply-chain is stretching their payables and feeling the pressure—from Cultivators to Brands and other non-Cannabis related servcies as well. California is not unique to this and Kiva is seeing other markets with growing AR balances as well.
🚪 22% of All California Licenses Won’t be Renewed. Kristi noted hearing that some businesses are shutting down their business or letting licenses lapse. As capital remains constrained, Kristi is seeing operators struggle to remain in business.
🌎 Geographic Footprint. Kiva is currently in HI, AZ, NV, IL, MI, OK, OH, MA, MO and Canada. The company’s out-of-state expansion actually started as early as 2014 with Arizona, with Nevada and Illinois following shortly after. Out-of-state expansion became more of a opportunity and focus in the past two years with a Growth team that focuses on business development, sales, marketing, information transfer, and training. The company decides if it wants to enter a territory based on market size, regulations (are edibles even allowed), addresable population (21+), influencer state (CA, NY, IL), and operators/potential partners (philosophically aligned).
💤 Trends. Kristi is paying attention to rare Cannabinoids such as THCV and CBN (still going strong and a huge category, Kristi mentioned 50% of consumers are probably asking for sleep products) and unique extraction method (interesting to consumers and budtenders).
🏙️ New York. While visiting NYC in May, Kristi and Scott saw that Kiva chocolate bars (with Metrc tags) were already in market at twice the CA price. Kristi is excited about the equity components (50% of all adult-use licenses awarded to social and economic equity applicants) that the State is leaning into. When comparing CA & NY—Kristi points out a negative for NY—favoring stale packaging requirement, similar to Canada, which Kiva has sent comments to New York Office of Cannabis Management (OCM) to point out how hard it would be for legal businesses to compete against the illicit market if they can’t effectively communicate information about the product.
👋 The Highly Objective Podcast is hosted by Dai Truong, who leads Cannabis Investment Banking at Arlington Capital Advisors.. Third-party information presented here and links to third-party content are for informational purposes only and are not intended as a recommendation, offer or solicitation for the purchase or sale of any financial instrument, security or investment. The information provided is not warranted as to completeness or accuracy and is subject to change without notice. Linking to third-party sites in no way implies an endorsement or affiliation of any kind between Arlington Capital Advisors, LLC, or its affiliates and any third party. The information in this blog constitutes my own opinions (and any opinions posted by guest bloggers from time to time) and it should not be regarded as a description of services provided by Arlington Capital Advisors, LLC or any affiliate.