By: Carli Evilsizer | April 24, 2019
With the passing of the 2018 Farm Bill, hemp-derived CBD is now legal in all 50 states. And while there are still regulations surrounding cannabis, any cannabis product containing less than 0.3% THC is legal, which means we can expect to see a huge increase in CBD startups. In fact, the CBD market is projected to hit between $2 billion and $3 billion in sales by 2021.
So, are you an entrepreneur and a CBD enthusiast who’s wondering how to launch a CBD startup? There’s definitely many things founders need to be aware of before they launch a CBD startup. We got into the weeds with Minchul An, CEO and Co-Founder of buzzn to learn more about how he launched his new line of organic, premium and pharmaceutical-grade CBD oil supplements for people and pets. Keep reading to learn the hardest parts about launching a CBD startup, what Min wishes he knew before he launched buzzn and his top 3 steps to launch a CBD startup.
1. Tell me a little about your background!
My name’s Min, I’m the Co-Founder and CEO at buzzn. And, I wear many hats: I’m also a Registered Pharmacist, Founder of Urban Wag Dog Walking, and Korean K9 Rescue Animal Activist.
2. What was the inspiration behind buzzn?
buzzn was started as a desire to fulfill the need for more high-quality products focused on anxiety- and pain- relief. With the challenges I’ve faced as a pharmacist dealing with the opiate crisis and patients on habit-forming controlled substances, it’s time there be more healthcare professionals behind the cannabis plant, advocating for the natural healing properties and benefits.
3. What was the hardest part about launching buzzn?
Where do I begin? There were so many challenges in launching a CBD brand. The hardest part for me was finding a credit card processing system that would accept CBD sales. And a reputable merchant processor where we would not be in risk of being shut down. Although the recent Farm Bill 2018 was signed into law in December 2018, there’s still a lot of grey area regarding CBD products. CBD sales is still considered ‘high risk’ and requires a ‘high risk’ merchant processor.
4. What is something you wish you had known before creating a line of CBD products?
First off, being an entrepreneur isn’t easy–it’s not my first business. But being an entrepreneur in the CBD space is much more challenging. You need to be agile, and ready to change your brand as more research/studies come to light. I wish someone had told me the federal requirements on properly labeling CBD products, because the labeling on Dietary Supplements is slightly different than Herbal Supplements. Also, the term Full-Spectrum CBD is not the same as Broad-Spectrum CBD (a relatively new term), and we recently changed our labels/packaging to reflect that.
5. Are there any legal restrictions you have to abide by?
All CBD products must contain less than 0.3% THC in order to be able to sell to consumers.
6. For founders who aren’t pharmacists, what type of CBD education should they have?
If you’re a CBD entrepreneur, you 100% need to be educated on all things cannabis. It’s not like selling a bar of soap. Cannabis works with our endocannabinoid system to promote healing, so be sure to educate yourself on what you’re really selling, and what it can do for your customers. Keep up with the media, laws, and politics because changes are happening fast.
7. How are you marketing your products?
We’re currently not able to market CBD products on any social media platforms like Instagram and Facebook. No Google ads either. My team and I are finding creative ways to get our brand out there, like influencer marketing, affiliate programs, vendor events, collabs/activations, press and media coverage.
8. What has been one of your most successful growth techniques?
My partner and I both hold our Doctorates in Pharmacology, so we have advanced training in what drugs do to our body and, vice versa, what the body does to drugs. We love to host educational seminars on CBD and our body’s endocannabinoid system. We’ve gained a significant following through these educational seminars. Also, as I mentioned before, I’m a huge dog lover and I am animal rescue activist. I work very closely with dogs with trauma, and incorporate CBD into their diets as a mood stabilizer. Having partnered with Korean K9 Rescue group, a non-profit organization that saves dogs from dog meat farms in Korea, has given us a lot of visibility on our CBD pet products.
9. I love your branding! How did you create the buzzn brand?
Given that cannabis has been stigmatized for centuries, we wanted to take a different approach on our branding. We wanted to make our products more accessible and delicious for both humans and pets. Our mission was to simplify CBD wellness for the modern lifestyle. To do this, we started by developing a trendy and functional wellness aesthetic for the buzzn logo. A clean mint color combined with a rich and royal purple to give the brand a unique elegance and playfulness at the same time. Creative design was worked into the packaging by incorporating fun and informative infographics as well as clever copy and product naming strategies. Essentially, a hip and modern trademark logo and identity mark featuring the simple font families of Butler and Din Din combined with a celtic symbol meaning happiness.
10. With so many CBD startups popping up, what is the secret to creating a successful line of products?
The secret to creating a successful line of products is simple. Create high-quality, transparent products. As a consumer, it’s so important to do your homework and know where the hemp is coming from, where it’s being manufactured, and if it’s being lab tested—which by the way should always be made available to the customer.
11. What advice would you give to a founder in the early stages of launching a CBD startup?
Do your research. No shortcuts. Be transparent in everything you do from seed to sale. Find a reputable source and manufacturer, and always lab test your batches for purity and consistency. Make those lab results available online for your customers. Most importantly, be passionate about this industry in order to make an impact on something that’s been so stigmatized for centuries.
12. What has been your favorite part about launching buzzn so far?
Educational seminars, panel discussions, and vendor events—because I’m able to talk to customers and people genuinely interested in knowing more about CBD. I could talk your ear off about our body’s endocannabinoid system and how CBD works with the receptors in our body to promote healing.
HOW TO LAUNCH A CBD STARTUP: 3 KEY STEPS FROM BUZZN CEO & FOUNDER, MINCHUL AN
1. EDUCATE YOURSELF ON THE INDUSTRY
Take time to educate yourself on the industry, and understand the laws and compliance regulations regarding CBD. There’s so much happening with this industry, and it’s really important to be up-to-date in order to operate properly within the laws. Industrial hemp-extracted CBD is legal by the federal government as long as THC levels remain below 0.3%, but that doesn’t mean the FDA will not heavily regulate CBD products. Also, CBD laws are confusing per city and state, and so interstate commerce can get a little tricky.
2. FIND A REPUTABLE SUPPLIER
Be sure to research your suppliers farming practices to ensure a safe and regulated product. Your supplier must always provide a Certificate of Analysis (COA)–a lab test to confirm the levels of CBD, THC, and other compounds from the cannabis plant. I suggest you always third-party test It as well to confirm the purity and potency of the products.
3. CHOOSE A WEBSITE PLATFORM
This is an important one. Considering the legalities of CBD are still grey, a lot of website building platforms will shut you down. Be sure to do your research on which platform allows for CBD sales. Your common platforms like Squarespace, Wix, and Shopify are not allowed. I know so many CBD companies who use Shopify, but it’s only a matter of time until you get caught. Don’t risk it and do it right from the beginning. I suggest using WordPress.org with a separate hosting provider.