Curaleaf CEO Sees Immense Demand in Florida

do so. So we welcome cure Leaf CEO Matt Darren joining us via zoom in Florida. Matt, good to have you here with Mattie and myself. How are you and how is business doing? Great? Thank you. Business continues to be brisk. It's we're continuing to see that cannabis is a recession resistance stable and despite many of the inflation crashers and other things going on the economy, people are

prioritizing their cannabis purchases, which is encouraging to see. All right, optimism, you sound optimistic, but in January, you guys did release that you're cutting your payroll by about ten percent. You were closing operations in California, Colorado, and Oregon at the same time, though there's some news just last week that you opened another dispensary in Florida. I think it's your fifty eighth in that state, one hundred and forty eighth nationwide in the US. So, first of all, kind of

square some things for me. Why the cuts in payroll, Why the shutdowns in California, Colorado, and Oregon. So a few things. First. You know, Pure got more than doubled for a number of consecutive years, and with that hypergrowth

comes opportunities to continue to optimize the business. So many of the decisions that we're making, I think are natural for high growth companies that are going through its next phase of evolution and is something we're seeing really throughout throughout the industry as it relates to our markets in the West Coast. Look, there are in a resource constrain,

capital constrained environment. We want to make sure that we are allocating our coal in our resources to the markets where we see the greatest opportunities, Florida being one of them,

with the largest medical market and adult use. On the horizon in the coming years, you have some markets such as California on the West Coast that have just experienced some major challenges for a variety of reasons, from lack of enforcement of the illicit market to high tax structures in place that have really made it challenging to to

be profitable in California. So for the time being, we're continuing to go asset light in those markets and hopefully they're going to stabilize in the coming years and you know, we'll be there. You tease this out a little bit, but can you talk to me a little bit more about why you like Florida as a market to continue to expand in. So Florida has been a wildly successful medical program with over seven hundred thousand patients in the

medical program. You know, the licensing structure allows you to expand your cultivation and manufacturing capacity as much as you would like, as well as to open up as many dispensaries, so you can really build scale in the Florida market, which we've continued to do by investing in our manufacturing and processing capabilities and continuing to open new dispensaries as you've seen. So it's really an attractive market and that's

just in a medical environment. So with adult use on the horizon at some point and one hundred and thirty million tourists that come to Florida every year, not to mention the demographic shift taking place with many people relocating to the state. It really is an attractive climate operating. How strong is the demand in Florida that you guys have so overweighted your exposure to that state. The demand

is immense. I think part of what we've seen is that there's certain parts of the state that have been slower to communities flower to zone for dispensaries, and so while there are you know, hundreds of dispensaries throughout the state, there's some are areas that have really not had much accessibility for medical cannabis up until recently. So we're seeing some greenfield opportunities in areas outside of Orlando and other parts of the state that we're excited to now be

represented in where we weren't before. Same thing in you know, south in Miami Dade County, there's areas that are new areas that have been opening up that are now zoned for medical dispensaries, whereby previously that was not an option available. So we're really we're very very focused on opening up a locations in these markets, but the opportunities are continuing to open up for that. Well, we got some big news last week that Twitter is allowing cannabis ads. I

imagine that that news was music to your ears. Can you talk to me about how big of a deal that is for you in the business. We see it as a really big deal. Twitter being the first major online social media platform to allow cannabis companies to advertise, albeit subject to restrictions, I think is a real big

moment for the industry. Historically, we've been very limited in terms of the digital marketing that we can do and frankly all types of marketing, and so the notion that we can now advertise and participate in social media channels, including Twitter, which has been very active in the cannabis space, is really a whole new opportunity and something that we're really excited for to capitalize on. My understanding to advertise on Twitter that cannabis companies must be pre authorized by

Twitter and meet many requirements. What are you learning about those requirements? So, yes, there are a number of requirements. Uh, you know, in the early stages here, we do need to be pre authorized by the platform to post ads.

There's restrictions on what can be advertised. You know, we're not advertising you know, most cannabis products in general, so there's some significant limitations on you know, what can exactly be advertised, and there's certain pre authorizations that are there as well as jurisdictions where we are able to offer these ads. So help me help me out. Is this correct that one of the most significant restrictions is that cannabis companies can't promote or offer for sale cannabis products.

Isn't that what advertising is? You are correct, We're able to offer advertise certain products that are at a very diminumous amount of THHC, things like our outstanding topicals, which do quite well in places like Florida. But you're right, Um, there are a lot of restrictions in terms of actually advertising the products that we dispense. But I will say that that is still progress from where we have been at where we've not been able to have any sort

of advertising presence on these platforms. So while um, certainly we're more limited than conventional CBG companies and others, this is progress from what we've been dealing with the last decades. So we'll take progress for the moment. Are you also a little nervous? And it just harkens back to kind of cigarettes, this whole idea that you can't target minors. I mean, like, how do you not well? I think

there's something that we take very seriously. Curley's roots are as a health and wellness company coming out of the medical space, and that's still very much in our DNA, even as we transition to adult use and are offering products across a variety of ways. You know, there's certainly ways to market and advertise that are not being directed towards youth, and that in terms of the way that products get presented and you know, many of those things.

So I think there's absolutely ways to market cannabis products. And the reality is a huge portion of our customer base is, uh, you know, kind of skewing older than younger. There's a reality, And forgive me, I really probably should have has phrased it more like it's hard to avoid anybody from seeing the ads that are out there. And I didn't mean to mean that you guys are necessarily going to target young folks, but I mean once the stuff is out there, pretty much anybody can see it.

Matt comeback because I'd love to continue this conversation and love to know more as you guys find out about the advertising rules. Matt Darren, He's chief executive officer of Cure Leaf, joining USBA Zoom from Florida. This is Bloomberg Radio.