CATEGORIES: Cannabis Industry Interviews
Matthew Feinstein is the co-founder and CEO of Pineapple Express, a publicly-traded company based out of California which is in the process of developing a national cannabis retail franchise.
Pineapple Express also has several other projects in the works, including their recent acquisition of the THC.com website and trademark, as well as a large facility in Desert Hot Springs, CA with 10 warehouses for cannabis production, one of which they have already rented out. We recently got in touch with Matthew to learn a bit more about what Pineapple Express has planned for 2016 and beyond! Read the full interview below:
Ganjapreneur: What was your career before Pineapple Express, and what motivated your decision to start your own cannabis industry venture?
Matthew Feinstein: After I graduated UC Berkeley in 1991, my family and I owned and operated a video rental chain of video rental stores on military bases in in supermarkets across the country. We had close to 400 company owned and franchised stores and we were based in Los Angeles. In 1999, I moved to New York for a couple years to head up the purchasing, marketing, and merchandising group for a new e-commerce site called urbanfetch.com. In 2000, I moved back to LA to start my own DVD distribution company called Starlight Home Entertainment. My company was the exclusive distributor of all Lifetime TV and Oxygen Network DVD programming and we manufactured, distributed, and sold the DVDs to all the key retailers such as Wal*Mart, Blockbuster, Target, and Redbox. When I saw that the DVD industry was shrinking and less and less people were renting and purchasing DVDs, I went to work for one of my favorite customers, Redbox. There, I was able to transition from the Home Entertainment industry into the automated retail (kiosk) industry. It was around the time that I learned there was not a lot of room for advancement in this company, when I heard about a cannabis company called Medbox. In 2013 I became VP and a Director for that company. I assisted many clients in the dispensary and cultivation center application process in states such as Illinois, Nevada, Washington, Oregon, and California. I also assisted with store build out, operations, and training. Management changed at Medbox, and the Founder and I started a new publicly traded company called Pineapple Express [Ticker Symbol: PNPL].
What advantages does Pineapple Express gain by being a publicly-traded company as opposed to a private company?
Being publicly traded helps us gain more visibility. Visibility is important when building the brands Pineapple Express and THC.com — it also opens up more funding for our company and the projects that we are working on.
As a publicly-traded company, do you think you will face increased scrutiny from the federal government regarding your involvement in a federally illegal industry?
We are landlords and consultants. We don’t touch the plant. We invest, expand, and brand. We offer capital infusions to canna-businesses, we assist with their expansions, and we help them with their brand.
You recently announced that you were acquiring the THC.com domain name and trademark: can you give us any hints about what you have in store for this juggernaut cannabis brand?
We just finalized our acquisition of THC.com. We are also meeting with many experts to decide exactly what where we should take the website. We will be taking a company that has been operating since 1996 and investing, expanding, and marketing to promote its brand. Currently the site sells the THC branded clothing line and other types of apparel and items aimed towards the cannabis community. With the current scramble to brand and trademark marijuana industry related products, we believe we have hit a home run by acquiring the THC trademark for certain apparel items and the popular URL name and website. The organic website traffic and direct internet searches alone make it valuable.
What is the current status of your facility in Desert Hot Springs, CA? What is the long-term vision for the project?
We are super excited about our Pineapple Park project in Desert Hot Springs, California. Currently various news reports are stating more than 160 California cities and counties have proposed or already enacted bans within their city or county limits on commercial and/or personal cultivation of medical cannabis. Desert Hot Springs is the first Southern California city with a framework in place allowing cannabis cultivation facilities to exist. We have purchased and are in escrow of over 8 acres of land there. We are going to eventually have ten buildings on that land each approximately 20,000 square feet.
We currently have one tenant occupying the first building. We secured the Conditional Use Permit and Regulatory Permit for this tenant. Now we are expanding the Conditional Use Permit with the city and are pre-qualifying other tenants now. We will then secure the regulatory permits for the new clients which will allow them to occupy and grow in the other 9 buildings. All together, we desire 125,000 share feet of rentable warehouse space occupying 7.5 acres. It is going to be safe secure and green. We are also working with a Southern California based real estate firm to assist with the property acquisition in DHS. This is a company that has developed or re-developed in excess of $2.5 billion in commercial projects!
On your website, it states that Pineapple Express plans to launch a chain of branded retail stores nationwide as soon as it is federally legal to do so. How long do you think it might take for that to happen? Are you currently establishing these retail stores in the individual states that have legalized cannabis?
Pineapple Express intends to be one of the first nationally branded cannabis retail stores, called “Pineapple Express”. We called upon the design folks who created the concept for Jimmy Buffet’s Margaritavilles to create our concept store. I am going to utilize my expertise of opening company owned and franchised stores across the country in creating this chain. I am working with my VP of Business Development Theresa Flynt, who is already planting the seeds for this chain of stores. Right now we are consulting and acting as a landlord. These stores are “Powered by Pineapple Express”. We believe that in approximately three years, the federal government will change the schedule of marijuana from schedule 1 to schedule 2. We also believe that the federal governement will follow the same path that they did with gay marriage. They were watching and learning while certain states made gay marriage legal. Then, more and more states made it legal. Then…before you knew it…the federal government decided to make it federally legal. We see the same kind of momentum happening with legal marijuana right now.
Does Pineapple Express also plan to offer franchisees perks such as collective buying power, marketing materials, and strategic partnerships with producers/processors? Will anyone who meets their state’s requirements for opening a cannabis retail location be able to become a Pineapple Express franchisee?
We will offer franchisees (or licensees) collective buying power, marketing materials, strategic partnerships with producers/processors, and also branding and many other types of industry business expertise.
What do you think is the biggest challenge faced by the cannabis industry in its current state? How can the industry work together to overcome it?
I think the biggest challenge faced by the cannabis industry right now is the lack of professional companies that have proper knowledge needed to really have nationally recognized leaders in the industry. Right now, branding and being a first mover is so important. Once federally legal, big pharma is going to move into this space, along with other really well known companies. That’s why it is so important to be a first mover right now…and to execute properly. We are working diligently in making our brand Pineapple Express known, and soon we will with THC.com. We are also executing carefully and properly. With this, we will grow as the industry grows.
Do you think there is any risk, at this point, of federal action that would undo the progress that has been made by states in dismantling prohibition over the past several years?
I believe there is too much momentum with the legal cannabis industry now to experience any setbacks. There are too many benefits of cannabis. The federal government needs to take cannabis off as a schedule I drug and make it a schedule II drug. This will allow for more federal research and assistance.
What advice would you offer to an aspiring “ganjapreneur?”
Get into the cannabis industry now! You will be upset you didn’t later. There are not a lot of new industries that we will see in our lifetimes. Especially with this much growth and potential. Its like the beginning of the tech industry in the late 1990’s. Or better yet, it is like right after the end of prohibition. We have an employment section on our website and even a place to submit a business plan to. If we don’t have a place for you in our company now, we may later!
Thank you, Matthew, for taking the time to answer our questions and share what Pineapple Express is doing! To learn more about Pineapple Express or to get in touch with them directly, visit PineappleExpress.com. Questions/comments? Post them below!