Staffing a business may seem like a straightforward endeavor, but with an often complex regulatory landscape and labor needs that fluctuate seasonally, hemp business owners have much to consider when hiring and training employees.

Hemp Temps launched in 2013 as one of the first staffing agencies to serve the cannabis and hemp industries. The Denver-based company specializes in helping Colorado and Oklahoma dispensaries, cultivation/farming operations, extraction facilities and kitchens find temporary and temporary-to-permanent employees. CEO John Paul Dreibelbis spoke with Hemp Grower to share his tips for hiring, from helping you determine the size and scope of your workforce needs to finding the right candidates to onboarding and training new employees.

Note: This article originally ran in the November/December 2019 issue of Hemp Grower.

1. Consider how labor needs fit into your overall business plan

Long before a business starts production and harvest, it should consider how many full-time, part-time and temporary workers are needed to achieve the business’s goals, Dreibelbis says.

Businesses should ensure standard operating procedures (SOPs) are in place for cultivation, drying, curing and processing with a clear end product and go-to-market strategy in mind. They should also maintain a calendar of harvest and testing dates. These objectives will help business owners understand the operation’s workflow and how much labor is needed to keep things running smoothly throughout the season, Dreibelbis says.

“Whether you’re using machines or doing hand-trimming or defoliation, have an understanding of what it’s really going to take to get the job done,” he says.

2. Define desired qualifications (and how you might teach them)

It is important to define the basic skill sets and qualifications needed when searching for candidates. In this nascent and rapidly growing field, Dreibelbis says to focus on attitude over experience.

“As long as they’re willing to do the job, learn and work hard, that’s really what we look for,” he says.

Some employers may take this a step further and require a certification or compliance training program as a prerequisite for certain positions, he adds. To meet those industry needs, Hemp Temps started Hemp Temps University, which offers free in-person and virtual training programs where employees undergo compliance and technical training to learn the job fundamentals.

Dreibelbis says all employees attend orientation, complete trimming and harvesting training and learn about the Environmental Protection Agency's Agriculture Worker Protection Standards (WPS).

For farmers who don’t have access to these training materials or prefer to self-train, it’s important to consider how you will vet qualified applicants and how you will train those new to the industry.

3. Implement a training program that thoroughly covers safety protocols

Newly hired staff will not only need to be trained in the day-to-day operations and job duties, but also on safety, Dreibelbis says.

“[Make] sure that people are wearing hairnets, beard nets, [and] changing out of their [street] clothes [while working in the processing and packaging areas]. Those are things to keep an eye out for.”

Federal and state agencies also have their own required safety training that employers must adhere to, such as the WPS. “Worker safety is a huge deal,” Dreibelbis says. “You can’t be exposing employees to pesticides, so understanding what those protocols are is … huge because [employers] can get fines from the Department of Agriculture and get potentially shut down.”

4. Set realistic expectations

Another part of the onboarding process is ensuring that new hires understand what is expected of them—and that these expectations can actually be achieved, Dreibelbis says.

“For us, [it’s] making sure they understand what they’re getting into because I think a lot of times, people just hire people, [and new hires] might read the title, but not really understand what it entails,” he says.

If job titles and descriptions are not clearly defined, a facility can quickly become unorganized, Dreibelbis adds.

“People show up, and then next thing you know, everybody’s kind of doing their own thing,” he says. “And then, when they’re not happy with the results, they start pointing fingers. [Be] proactive, [have] a clear picture of what’s going to be done, and maybe [set] some rewards for overproduction … to really keep everybody on the same page and happy.”

Businesses might consider having images and visual aids on the wall that offer examples of what is expected of employees as well as clearly documented processes and goals for each workday, Dreibelbis adds.

“[Take] 10 minutes before the day starts to give everyone a pep talk on what to expect, how the day’s going to go, what time breaks are going to be taken, … who’s in charge of what,” he says. "And [have] clear go-to SOPs where, if someone forgets, they can go look at pictures and diagrams.”

Beyond imagery, designate people who employees can seek out, both on the jobsite and at headquarters, with any questions or report any problems.

5. Consider the market when setting wages

Pay is often a touchy subject with potential hires and employees, but Dreibelbis says wages should be based on tenure, experience, reliability and the market forces at play.

“The price per pound really dictates the value of what the going rate for the position is,” he says. “Unemployment is super low right now, so we’re seeing wages rise. And if you look at [the overall] unemployment [rate] of 2.8% in Colorado, … less and less people [are] available to work. With that, wages are rising, and it’s just like anything else [with] supply and demand.”

While there are, of course, average going rates for each position, wages are ultimately decided based on what the employer and employee agree upon, Dreibelbis adds, but employers should keep in mind that employees are most willing to work for what they believe they are worth. Employers should also consider establishing clear avenues for raises and career advancements, which can help prevent or reduce turnover.

6. Keep your books in order

As a team grows, so do employers’ back-of-house duties, such as maintaining proper insurance coverage and payroll.

For example, companies might try to classify workers as independent contractors (1099) rather than full-time employees (W-2) because the companies don’t have to provide medical insurance or workers’ compensation to 1099s. In addition, wages are non-taxed for 1099s.

“It’s unfortunate, but we see a lot of companies that just try to pay everybody as a contractor, and the states are cracking down on that,” Dreibelbis says.

He points to Colorado as an example. The state conducted an audit of all employees who were classified as 1099 and found those people were not paid through a Federal Employer Identification Number (FEIN). A deeper dive revealed that there was misclassification of employees.

7. Value your employees (equally)

Above all, businesses should treat their employees with respect and make them feel welcome regardless of their status as a full-time, part-time or seasonal worker, Dreibelbis says.

“[Make] them feel welcome and [make] them feel like they’re an equal with the rest of the staff,” he says. “A lot of times, there’s this culture where the existing staff don’t necessarily treat the temporary staff with the respect that they deserve. And inadvertently what happens is those people move on.”

Both temporary and permanent employees should be given the tools necessary for them to do their jobs, Dreibelbis adds. “[Have] the tools for them to be successful and [have] a really clear plan on how to explain that. Don’t just assume that employees know what you want. You have to explain to them what the process is going to be, and sometimes you have to explain it more than once.”

Businesses can implement incentive programs, he says, such as offering rewards when production goals are completed, to keep employees motivated and engaged.

In addition, “[Have] a location that’s easy to get to, the right facilities, bathrooms for people to use, the break area [and give] employees the breaks that are state and federally mandated. [Understand] those rules,” Dreibelbis says, and treat employees like you value their contributions to your business.

The need for and shortage of qualified staff will continue to grow as companies ramp up production and as the hemp industry standardizes and matures. Farmers can’t do it all themselves, and they can’t get by on family and friends anymore, either. It’s important to take the time now to focus on staffing and formalize procedures to help make the hiring process less burdensome and set standards that make it easier to find and train future applicants, as well as retain talented employees.

Melissa Schiller is assistant digital editor of sister magazines Cannabis Business Times and Cannabis Dispensary.

So, you’re ready to make money off your hemp-related intellectual property (IP)? You have managed to develop a cultivar that consistently yields a high percentage of cannabidiol (CBD) and a low percentage of tetrahydrocannabinol (THC). Naturally, you believe you’ve got something special on your hands that people will line up to pay for. And you’d be correct. With proper IP protection, you can easily license the right to use that cultivar and watch the money flow in. Right? Well, not so fast.

The process of obtaining IP protection is not as straightforward as you think, and the competition is fierce. The threshold to prove your uniqueness is high.

Following the Agriculture Improvement Act of 2018 (the 2018 Farm Bill), the “unicorn” that everyone is chasing right now is a cultivar of hemp that guarantees high CBD and low THC, says Corey Cox, J.D., an attorney in Vicente Sederberg’s Denver office.

“We are seeing a huge push right now toward proprietary hemp genetics and unique varieties of the hemp plant,” says Cox, who specializes in regulatory compliance for hemp and marijuana businesses. “People are trying to develop these varieties and protect them from use by competitors. And some want to only license their IP, so they don’t have to have any physical manufacturing capabilities. They simply want to license their genetics to production partners.”

This hemp IP rush can be attributed to new federal testing guidelines. To be legal under the 2018 Farm Bill, hemp must test at or below 0.3% THC—the main psychoactive compound in marijuana. If your hemp crop tests above the 0.3% limit, you’ve got what is known as “hot hemp,” which to the federal government essentially means you grew illegal marijuana. According to most state statutes, those hemp crops must then be destroyed. That puts a premium on good genetics. And while genetics are not the only factor involved in a crop’s final CBD and THC levels, they are an essential foundation

“Having hemp seeds that you know are not going to test high for THC—and can be reproduced without complication—is a really, really big deal,” says Dale Hunt, Ph.D., J.D., a plant scientist, cannabis lawyer and registered U.S. patent attorney with over 20 years of experience protecting plant varieties.

But while IP licensing may soon become big business in the hemp industry, the devil is in the details. U.S. IP law and regulations, along with the 2018 Farm Bill itself, have far more nuances and complexity than many people understand up front.

To separate fact from fiction, Hemp Grower spoke with IP experts who offered three imperatives to help you not only protect your intellectual property but also profit from it.

1. Study Your Options.

The U.S. Patent and Trademark Office (USPTO) provides different protections for different kinds of intellectual property. As a starting point, hemp businesses should understand the key differences between at least two types of patents: a plant patent and a utility patent.

A plant patent is granted to someone who invents or discovers—and asexually reproduces—a distinct and new variety of plant (other than a tuber-propagated plant or a plant found in an uncultivated state). As Sterne, Kessler Goldstein & Fox P.L.L.C. attorneys Pauline Pelletier, J.D., and Deborah Sterling, J.D., explain in a recent blog post, plant patents offer protection for asexually propagated plants (clones having identical genetics to those of the patented plant), but they do not protect sexually produced plants (those cultivated by seed). A plant patent, in essence, provides legal protection from a competitor who grows your specific cultivar from a clone.

A utility patent, on the other hand, is granted to someone who creates a new or improved—and useful—product, process or machine. A utility patent offers much broader protections than a plant patent. It protects your unique seeds and the various chemical compositions of the plant—not just the clone.

“While a plant patent covering a commercially valuable strain for cloning purposes certainly has value, its scope is bounded to the genetics of the patented plant and leaves room for sexual reproduction (e.g., seed farming),” Pelletier and Sterling wrote in their blog post. “By contrast, a utility patent covering a non-naturally occurring strain, where the claim is defined in terms of the plant’s novel characteristics, could make the avoidance of infringement more difficult and thus serve as stronger patent protection.”

Hunt explains a plant patent is like a copyright on a single cultivar—it protects against illegal clonal copying of the exact genotype of the claimed cultivar. In contrast, a utility patent treats a cultivar as an invention.

One other way exists to protect IP associated with plant varieties. In addition to legalizing industrial hemp, the 2018 Farm Bill opened the possibility for hemp IP protection through the U.S. Department of Agriculture’s Plant Variety Protection Office, which provides intellectual property protection to breeders of new varieties of seeds and tubers for 20 years.

Plant Variety Protection (PVP) essentially protects seeds from being “copied” in bulk to compete with the owner of the variety. However, it permits use of the seeds for breeding to make other new varieties. This is called the “breeder’s exemption.” PVP rules also expressly permit the purchaser of protected seeds to keep enough seeds to replant the same acreage as the seeds he or she originally purchased for planting. This is called the “farmer’s exemption.”

In sum, while plant patents apply to asexually propagated plants, utility patents may apply to genes, traits, methods, plant parts and varieties. Additionally, PVP is now available for seeds and tubers.

2. Let the Business Be Your Guide.

No one-size-fits-all solution exists in plant IP, especially with a plant like cannabis that can be propagated via seeds or clones. This is why companies should let their sales strategy dictate their IP strategy, Hunt says.

So, based on what you sell, what kind of IP protection do you need?

If you make money selling hemp seeds, a utility patent may be your best defense. A plant patent would only be useful if the cultivar that is the source of the seeds is itself so valuable that you would want to control its propagation, Hunt says. The most prominent example of this in the hemp industry is Charlotte’s Web, a popular CBD-dominant strain that has helped countless young patients as an epilepsy treatment and has become a figurehead for the legalization of medical cannabis after its appearance in CNN’s Weed series. In 2019, Charlotte’s Web received what is believed to be the first plant patent for a hemp strain. The plant patent describes “CW2A” as a Cannabis sativa L. cultivar that is capable of producing up to 6.24% CBD and only 0.27% THC. For Charlotte’s Web, a plant patent is like insurance against potential theft of the propagating material of its “seed parent” cultivar. However, that plant patent would not directly fit or support the business of selling seeds; in those cases, you would need a utility patent, since a utility patent protects your unique seeds, not just your clones, Hunt says.

Shifting to another scenario, let’s say you sell clones to nurseries that will propagate and sell more clones to other people. Then you need a plant patent and a license agreement with that nursery requiring it to pay you for every clone it makes and sells, Hunt says.

But if you’re only selling harvested flower or extracts and you do all your own farming, the risk of IP theft or infringement would be negligible, since you would have more control over what potential IP others can access. But Hunt says a grower can still seek IP protection as a form of insurance: a plant patent to protect the genetics in case someone was to take a cutting and start competing with you or a utility patent to claim the genetic line more broadly.

3. Prepare for Legal Battles.

While patent litigation has long been a battlefront for technology-focused companies, IP skirmishes are beginning to expand into the cannabis and hemp industries. In 2018, in the first case of its kind, United Cannabis Corporation (UCANN) sued Pure Hemp Collective Inc., for infringing on its 911 Patent, which covers liquid cannabinoid formulations of a purified CBD and/or THC greater than 95%.

The case serves as a reminder that cannabis and hemp companies must be mindful that production methods, technologies and business processes, as well as product logos and packaging, are all subject to legal protection, wrote Knobbe Martens lawyers Jonathan Hyman, Hans Mayer and Christopher Smith in an article for Hemp Grower’s sister magazine Cannabis Business Times. As laws surrounding production and sale of cannabis begin to relax, companies may be more willing, or even eager, to enforce their intellectual property rights than before, they noted.

As the hemp industry grows, legal battles over awarded patents’ validity may intensify, says Theodore Y. McDonough, J.D., counsel for Carter Ledyard & Milburn.

“People have been experimenting with cannabis and hemp for quite some time behind the scenes, under the radar,” McDonough points out. “Somebody may very well have come up with that CBD formulation a number of years prior, and the question is, is that going to be a ‘prior use’ that would invalidate an otherwise valid patent? We really don’t know yet.” In intellectual-property law, “prior user rights” can serve as a patent-infringement defense. But there has not been much case law to go on.

With growers under pressure to produce hemp that will test below the 0.3% THC limit, all eyes for now are on the genetics.

“Any company that’s involved in genetics has a huge business opportunity in developing these strains, and obviously that takes time and money,” says Nathalie Bougenies, an attorney with Harris Bricken who represents clients who have filed for hemp patents. “As we know, a big part of the value in a company is their IP assets. My advice is to definitely spend the time to prepare a patent application [to] protect your work and make money.”

Social media has matured from its simple, sociable roots to become a critical component of any successful marketing initiative. Whether you’re new to hemp or a seasoned grower, succeeding on social media is crucial to building your hemp brand and spreading the word.

To help you make the most of your posts and avoid unnecessary social setbacks, Hemp Grower spoke with three social media experts working in the hemp space.

The following are their tips to help your hemp company achieve social media success.

1. Be Proficient, Prepared and Predictive.

Bracco: “We often think of social media in the larger sense as ‘Oh, it’s just social media,’ but part of the job is navigating compliance and law, state by state and in the U.S. and Canada, daily. You have to be thorough and understand what you can and cannot do. … You have to come in prepared with compliance rules as they currently stand, and you have to be predictive regarding trends affecting social [media] and the industry. It’s something you have to have your finger on the pulse of every day.”

2. Craft a Compelling Story.

McHenry: “Every company, large or small, needs to have a story—a background narrative that really explains their reason for being and their vision going forward and establishes their core messaging. … Every farm has a story. It came into being for a reason. There’s a family involved. There’s land. As the French say, there’s the terroir. ... All those things combine. All can be elements of a compelling story that is the heartbeat of their business.”

3. Define and Refine Your Voice.

Ginsburg: “Even though social media platforms are designed for easy use, I recommend taking a second to step back. Start with figuring out: What is your voice, what do you look like, what do you sound like? If somebody was shown 10 different posts, would they be able to pick out the three that were you because there’s some consistency and familiarity in how you are representing yourself? … Taking that time to really define your voice and settle into what feels right is a really important starting point. [Social media] is just not something to be entering into lightly, even though it’s quick and easy to get started.”

4. Decide What Platforms Are Appropriate for Your Business.

McHenry: “Some are obvious for everybody: Facebook and Instagram, for instance. In the hemp community on Reddit, you have a large and self-organized group of hemp growers, brokers, extractors and manufacturers. … Most people think of LinkedIn as a place to post your resume and connect with people in your niche, but it’s also a powerful publishing platform that enables you to enhance your company page or your personal profile by publishing value-added content that is engaging and will highlight your brand in the best possible ways—or at least establish you as an expert in your field.”

Bracco: “Choose a channel that you think best speaks to your demographic. If you’re a vertically integrated company, I think Instagram is the place to be because I think hemp is very visual. If you think you have something to say about the future of hemp, agriculture and cannabis, then you should be on LinkedIn and Twitter, and make sure that you’re tapped into the news and thought leadership. Start with one channel or two. … I wouldn’t go hog wild cross-posting across every channel without doing your research or getting experts to help you.”

Ginsburg: “LinkedIn is a really smart space for hemp companies to be showing up because LinkedIn is the business social network. … I’m seeing LinkedIn as a place where these more serious conversations [are happening] about what’s going on with businesses and what are the ramifications of living in these gray areas. I think that’s really interesting, and it marks this bigger shift in the hemp industry really earning its credibility.”

5. Choose Your Social Media Handles with Care.

Ginsburg: “A couple of real brass tacks are thinking about what you want your handles to be and making sure that they make sense and go with your brand—and, ideally, getting the exact same [handles] across the platforms that you want to be on. … You want to be as consistent and seamless as possible across any and all platforms that you use.”

6. Plan Your Work, and Work Your Plan.

McHenry: “A 52-week content schedule is a real important tool for any social media marketing. It involves sitting down and coming up with a content schedule for the year, like an editorial calendar on the journalism side. It needs to be flexible so you can react to things as they come up, but it’s a pathway, a road map that gives you a source of ideas for developing content. When you look from a 52-week perspective, you realize seasonal opportunities that need to be addressed, events during the calendar year that can be leveraged. ... Opportunities will reveal themselves if you take a good, long, 52-week look.”

7. Keep Your Messaging Tight.

McHenry: “I tell my clients to start with one core piece a week, usually a longer piece, like a Facebook post or a company blog. Generate that piece, and then use it for all the messaging for the rest of your social media all week long. Parse it into snippets for Twitter or take a paragraph for a Reddit post or take the images and use those [as] Instagram posts. You can keep messaging tightly coordinated across a whole bunch of social media platforms if you really organize yourself and derive all other social from that core piece.”

8. Keep Your Overall Marketing Strategy in Mind.

Bracco: “Digital brand management, social media marketing, the social care—which is the customer service and the community management strategies—all have to work in tandem with your integrated marketing communications program and your public relations program. … Decide very clearly which channels serve which purpose in your overall cohesive PR and marketing program.”

9. Cut Through the Noise With Authenticity.

Bracco: “People know when you’re just being a billboard. … If you invest in being honest about who you are and what your company stands for and the values that you have, and you show people how you’re doing that behind the scenes and what you’re doing every day to adhere to those values—and you do that in an authentic way—people will respond to it.”

10. Let Technological Tools Simplify and Inform the Process.

McHenry: “There are many tools—Hootsuite and Buffer are two—for managing content across a variety of different social media platforms and queuing your content up so you can schedule it in advance, all from a single platform. ... Any tool that helps automate the process for you is a great tool. You can organize your whole week Monday morning and rest assured it’s posted on the schedule specified.”

Ginsburg: “If social media is an aspect where you really want to make an impact, really understanding the data behind it can be just as important as crafting a great message with a beautiful image. I would not discount getting into the real nitty gritty of it. Social media marketing is not always just a beautiful message that compels action. It’s also that technical component of when is the right time to deliver this and who’s it going to.”

11. Understand That Multiple Metrics Matter.

Ginsburg: “When you really care about building community and good credibility [so] that you are there and you’re available to interact in a positive way, that’s pretty invaluable. However, people do assign credibility and worthiness to the number of likes and follows you have. Doing things like consistently posting great content, following other companies and individuals, commenting and interacting in a way that gets them to link back to you or like your stuff in return, that does matter. How many followers you have can influence how you show up in results and can certainly influence buyer behavior.”

12. Strive For Meaningful Engagement.

Bracco: “I believe the health of a [social media] community can be gauged by the comments and the sentiment of what people are saying. Then it’s about engagement. Are people actually making substantive engagement? Any person who comes to your community who is a detractor is someone you can make into a customer. Everyone who is a customer is someone you can make into a repeat customer. Every repeat customer can be a brand advocate. … If someone feels compelled to share what you’re saying about your brand, what you stand for or what you sell, to me that’s the highest level of engagement you can possibly have.”

Family businesses can be defined by the strength of six dimensions, according to recent research by The Family Business Network and Egon Zehnder, the global management consulting and executive search firm. The No. 1 dimension, according to the research: Shared values.

This study revealed that shared values unite family members and provide a common framework for building relationships both within and outside the business. Shared values also give the business a moral center to help differentiate it in the marketplace and sustain it in the face of adversity.

If you spend any time talking to the members of the Justice family, who own The Hemp Mine LLC in South Carolina, one thing will become eminently clear: They epitomize a business of shared values. In just under two years, the Justice family has built an organization that prioritizes a love of farming and respect for farmers, a duty to the community and a tenacity to innovate.

For Allison Justice, Ph.D., the roots of these values run deep. Her maternal grandparents, Fred and Gladys Isbell, farmed cotton, and her mother, Deborah Justice, grew ornamental plants and raised cattle on the same plot of land. So, after she obtained degrees in horticulture from Clemson University and served as vice president of cultivation for the California cannabis company OutCo, Justice decided to return home to help her family start a hemp business.

Read more: Career Treks Into Commercial Cannabis

South Carolina launched a pilot program for growing hemp in 2018, offering 20 licenses for growing 20 acres each. The Hemp Mine obtained one of those licenses. But in the wake of hemp’s federal legalization through the Agricultural Improvement Act of 2018 (the 2018 Farm Bill), Justice saw an opportunity to expand her family’s legacy in farming and draw the family even closer together around a new cash crop. She also saw the chance to show a nascent industry how resilient the Justices really can be, having already made three successful farming pivots from cotton to ornamental planting to cattle.

Read more: Replacing Chemistry with Biology

“We’ve tried our best to be savvy about what we grow, knowing that we don’t have thousands of acres to take advantage of,” Justice says. “We have to be smart about what we’re growing, and it can’t be what everyone else is doing. We need to have a niche for ourselves—and that’s kind of always been the path we took as a family.”

Initially, Justice, along with her mother, Deborah, siblings Amanda and Matthew, and family friend M. Travis Higginbotham Jr., created a brand called The Hemp Mine to sell the cannabidiol (CBD) they were producing from hemp grown on their farm. In August 2018, the Justice family sought to diversify their business. They partnered with OutCo and an investor to create their own CBD extraction facility called SC Botanicals, which now also extracts oil for other farms in addition to The Hemp Mine. And recently, the Justices, ever-aware of changing market conditions and the need to carve out new niches for themselves, have turned their attention to another growth venture: genetics.

Ready for Change

With CBD hemp prices suffering from an oversupply of farmers rushing into the market, genetics give The Hemp Mine options for the future, Justice says. In August 2019, biomass was selling between $2.73 to $4.50 per percentage point of CBD content, according to pricing from PanXchange. By January 2020, that had fallen to less than $1.

“Where we see the most potential is in the genetics. So, we’re going to keep going on that path,” Justice says. “The regulations are changing daily, prices for CBD oil have dropped near seven times within a year, and so you have to be ready to pivot.”

Good genetics are in high demand, and the challenge of doing something different and difficult, like breeding cultivars, suits the Justice family well.

For example, back when the Justice family was growing ornamental plants, they were competing against large greenhouses with automated processes that could produce pansies for pennies. “We had to pivot and pick something that required a little more work, a little more research, and use our brain power to make a better-margin product,” Justice says. “When we were doing ornamentals, we had to stop and think, ‘What can we grow? What’s in high demand? What’s not out there? What might be different and a little more difficult to breed? Let’s teach ourselves whatever that is, master it and sell it.’”

What about Clematis armandii? For a time, the Justices grew the climbing plant of the genus Clematis prized by gardeners for its showy flowers. “It was something that people wanted, and it wasn’t out there,” Justice says. “It wasn’t out there because it was difficult to grow.”

“You have to be ready for change, because over the years, everything changes,” says Deborah Justice, who plays multiple roles for The Hemp Mine, including that of chief financial officer.

Fortunately for the business, the Justices’ closest non-family business partners share the same outlook.

Ashish Joseph, SC Botanicals’ CEO, believes a good pivot in business is one that creates options for future moves.

SC Botanicals has not only diversified its geographic customer base to include Tennessee, Alabama and North Carolina in addition to South Carolina, but also focused on the remediation of delta-9-tetrahydrocannabinol (THC). (Delta-9-THC is the chief intoxicant in cannabis.) To be legal under the 2018 Farm Bill, hemp must test at or below 0.3% total THC. If a hemp crop tests above the 0.3% limit, it’s known as “hot hemp,” which, to the federal government, is essentially illegal marijuana.

“THC remediation—not everyone can do it,” Joseph says. “It’s a very capital-intensive process. But we have developed our own technology, and it’s been going really well. You have people sending us material that’s hot, and we remove the delta-9-THC to compliant levels.”

As families, the Josephs and the Justices have a deep connection and similar value systems. Originally from the New York tri-state area, the Josephs purchased 20 acres of land in South Carolina in the mid-2000s with the intention of building houses on the property and relocating there. But then Joseph’s father had a change of heart; the family had been involved in multiple businesses in the Northeast and didn’t want to sell it all and move. So, they decided to rent out the land to the Justice family for farming purposes.

 

When the 2018 Farm Bill passed, the Justices reached out to the Josephs and asked if they could use the land to grow hemp. The Josephs not only agreed but also decided to join the venture, first as an investor in SC Botanicals.

“I was like, ‘Absolutely. Do you guys need any capital?’” Joseph recalls saying. “We know hemp isn’t cheap—whether it’s seeds or extraction, you need capital.”

Joseph’s role as SC Botanicals’ CEO follows his more traditional business background. He studied finance at Drexel University in Philadelphia and previously worked at an investment firm. However, farming is in his family’s blood as well: They were rubber tree farmers in India. His grandfather, father and uncles all had brokering licenses to supply Apollo Tyres Ltd., based in Gurugram, India, with the raw materials to make car tires.

“One thing my grandpa always taught me is don’t plant what everyone else is planting,” Joseph says. “It’s bad for business. ‘When people are cutting down their rubber trees to plant vanilla because vanilla prices are high, don’t do it,’ he said. Everyone’s going to do that, and the price of vanilla will drop. Meanwhile, the prices of rubber will go up.”

Now, along with the Josephs, the extended Justice family is bringing the same resolve and strategic mindset to the research and development of genetics. For her part, Justice sees genetics as a potentially lucrative growth business and a way to apply her previous cannabis knowledge and experience for the betterment of growers and farmers in the surrounding South Carolina community and the nation as a whole.

Resiliency From South Carolina to California

Most hemp farmers across the country are after the same thing: a cultivar that consistently yields a high percentage of CBD and a low percentage of THC. According to the U.S. Department of Agriculture’s (USDA’s) interim final rule, hot hemp crops must be disposed of. That puts a premium on good genetics. And while other factors do play some role in a crop’s final CBD and THC levels, genetics are a major determinant.

Decades of hemp prohibition and destruction of the nation’s hemp seed bank effectively erased centuries of innovation in American hemp genetics. That has put U.S. farmers at a competitive disadvantage compared to Europe, China and other countries with a longer history of hemp cultivation, which is only exacerbated by the THC limit imposed by the federal government. With a dearth of sufficient high-quality hemp genetics that remain at or below 0.3% THC through maturity, farmers and growers have struggled to locate specific strains and vet seed businesses, in some cases losing many thousands of dollars because they accepted the claims of unscrupulous seed suppliers.

“Watching my family and having a true respect for farmers—that’s one reason why we got into genetics in the first place, because I can’t stand people being taken advantage of,” Justice says. “Farmers are such hard workers who deserve more than most. That’s where the passion comes from for what we’re doing.”

After conducting several years of research and testing, The Hemp Mine is commercially offering seven different hemp varieties to greenhouse growers and field farmers during the 2020 crop year. Six of those seven hemp cultivars are focused on producing CBD, with the seventh focused on producing cannabigerol (CBG). In tests, the latter cultivar has proven to yield 12% CBG and 0.15% total THC.

“I am super excited about farming new cannabinoids,” says Matthew Justice, who plays a key role in managing operations for the company. “CBG in particular—one thing we’re hearing from people is that it induces hunger—I’m excited to see how that can help cancer patients and people with eating disorders.”

“2020 is going to be a truly defining year for hemp in the U.S.,” says M. Travis Higginbotham Jr., co-owner and vice president of sales, consumer products and genetics for The Hemp Mine. “We don’t quite yet understand what the U.S. market is capable of.”

Though there is plenty of CBD available based on the quantity of hemp biomass grown in 2019 and planned for 2020, Higginbotham says The Hemp Mine has an advantage in its plans to address farmers’ ongoing search for hemp genetics that remain below the legal THC threshold: its home state of South Carolina.

“What is the perfect climate for growing plants? It’s California,” says Higginbotham, who first met Justice while they were studying horticulture at Clemson. “When genetics are bred to perform in California, they encounter very little stress. They have many days of sun, very moderate temperatures and cool nights, which plants like.” In contrast, the South is one of the harshest growing environments in the U.S. based on heat, humidity, moisture, drought, disease and pests.

Thus, the selling proposition of The Hemp Mine’s cultivars is that they have performed well in the Southeastern part of the U.S., an indisputably harsh environment for crops. Higginbotham cautions, however, that farmers west of South Carolina still have to take two variables into consideration: frost and day length.

The pivot to genetics has already proven successful. The Hemp Mine now has several hemp varieties that have produced as much as 22% CBD in tests that measure delta-9-THC levels. Unfortunately, when testing for total THC, as required by federal rules, that number falls to 10% to 12%, Justice says.

Under the USDA’s interim final rule, state inspectors must test for the total THC level, which is comprised of delta-9-THC plus tetrahydrocannabinolic acid (THCA). THCA on its own does not produce psychoactive effects like delta-9-THC, but it can be converted to THC through decarboxylation, which is the process required for testing.

Justice says these regulations have given the family another cause to rally around.

Finding a Voice and Raising It

The 2018 Farm Bill required the USDA to craft a set of federal hemp rules but gave states the right to develop their own plans for enforcing them. After Oct. 31, 2020, all hemp producers must be in compliance with those rules, including farmers who were producing hemp under a state pilot program. As of press time, the USDA had approved only eight state plans. South Carolina wasn’t one of them.

The rulemaking process, while painstaking for the industry, has galvanized industrywide thinking. Justice has had her part in shaping that thinking, embracing the role as an active public-policy advocate. The company, for starters, has filed a lengthy comment with the USDA on issues ranging from the required harvesting window to sampling protocols. Justice is planning to address the matter with state lawmakers as well.

“In states like South Carolina, we feel like we’re going backwards,” Justice says. Under the state’s pilot program, many growers and farmers have just gotten comfortable with how to grow the plant, what varieties work and who to work with in the supply chain. The USDA’s new “stringent” regulations turn those practices on their head, Justice says.

As of press time, it is still unclear whether South Carolina will continue to operate under its pilot program plan or under a new USDA-approved hemp production plan for the 2020 crop year—and that is what has created so much confusion and business uncertainty, Justice says. The Hemp Mine’s genetics business has already been negatively impacted in particular because potential customers are holding off orders until a decision is made and rules are finalized.

“I can name a handful of farmers that have made the decision not to grow hemp or not to grow it again because there were already such difficulties in joining this industry that it’s just kind of the last straw,” Justice says. “It’s just not worth it.”

The uncertain regulatory situation has created another opportunity for The Hemp Mine as a consultant to new farmers and growers. With the family’s collective experience in hemp and horticulture, The Hemp Mine offers to guide farmers on everything from planting to harvest to extraction, advising on how to comply with regulations all along the way.

The Hemp Mine’s sales representatives have technical expertise and, in some cases, degrees in agriculture. “There’s so much help needed, whether it is for simple farming practices that [are] never simple [or] regulation compliance,” Justice notes.

Embracing the Pivot

Despite the challenges facing small, family-owned businesses, including size, scope and the availability of capital, many thrive. According to The Family Business Network and Egon Zehnder, family businesses that endure have the right vision, involvement, cohesion and interaction, family governance and clarity on leadership principles and roles. And, most critically, they have the right set of shared values.

“One of the qualities of our family is we are problem-solvers,” says Amanda Justice Schell, operations manager and co-owner of The Hemp Mine. “There are challenges in shifting and pivoting from one thing to another. I think we really met those challenges head-on and worked through it and found a way to be successful. Our attitude is: ‘We’ll make it work somehow and get through it and come out the other end.’”

Like her sister, Justice Schell is a Clemson graduate, but she has degrees in landscape architecture and construction-science management. A creative type and natural storyteller, Justice Schell plays a key role in marketing the family’s businesses, which involves web design and photography. One of her favorite things to do, she says, is to get out in the fields and take pictures of the “beautiful” hemp plants.

Justice Schell has three daughters—Isabel, 11; Heidi, 7; and Olivia, 4—who may even comprise the fourth generation of the Justice farming family. The Hemp Mine is even sponsoring Isabel’s volleyball team, a development that speaks to the community’s acceptance of the hemp plant after decades of stigma. For Justice Schell’s daughters, the family hemp business is something to be proud of.

“They love going out in the field, scouting for insects, picking off caterpillars, helping in any way that they can,” Justice Schell says. “They’re always saying, ‘Can we go to The Hemp Mine today?’”

To Deborah Justice, the matriarch of the family, this brings an indescribable joy.

Asked how her parents, Fred and Gladys Isbell, would feel about the family continuing the farming tradition in hemp, Deborah Justice answered, “Incredibly proud.”

“I get emotional talking about it,” she says. “Our family—we’re all together every day working as one. We all believe in [hemp] and the future of it. As a parent, you couldn’t ask for anything better.”