Even now that the Farm Bill has passed, making it legal to grow industrial hemp and sell the products made from it, some state health departments have different rules about how those products can be used. For example, in Michigan, the health department says you can sell a bottle of CBD oil in a coffee shop, but you can’t sell coffee with that same CBD oil added to the cup. We are in the Wild West phase of this business, and it is constantly evolving.
As part of my series about “5 Things I Wish Someone Told Me Before I Started Leading a Cannabis Business” I had the pleasure of interviewing Jeff Gallagher is the founder and Managing Member of Made by Hemp in Jenison, Michigan. Gallagher is a pioneer in the hemp industry, starting his business on the ground floor in 2013 when it became legal to sell industrial hemp in the United States for the first time since 1937. Today, Made by Hemp is a multi-million-dollar business with more than 30 employees, two retail locations (with a third on the way), and a dedicated 1,200 sq ft lab for the manufacturing and formulation of high quality, domestically sourced hemp wellness products. Gallagher is passionate about hemp-derived CBD oil, and is driven to help others by educating consumers about its benefits and uses.
Thank you so much for doing this with us! Can you share with us the story about what brought you to this specific career path?
CBD oil helped me get my life and my health back after my own personal tragedy in 2012. My late wife and my father-in-law both passed away within a week of each other and upended my world. Shortly after that, I found myself experiencing terrible anxiety and panic attacks. The medical community’s answer was medication. At one point, my doctor had me on five prescription drugs, which made me feel numb and completely unlike myself.
Around that time, a neighbor introduced me to CBD oil, but I was skeptical. I took it reluctantly, but before I knew it, my panic attacks went away. I thought it was a placebo, so I stopped taking it, and the panic attacks returned almost immediately. I started taking the CBD oil again and within no time I was able to wean myself off of all 5 prescription drugs leaving me completely prescription free today!
Shortly after that experience in 2013, I set a goal to help five people with anxiety every month. I went online and bought $1,200 worth of CBD oil on a credit card from the only company I could find selling that quantity. Within a few months, I was shipping so many packages I had to quit my day job as an IT professional and jump into my CBD business full-time.
I had no idea a company like Made By Hemp would grow out of my part-time passion project helping people with their anxiety. I’m so glad it did because it gave me a platform to help more people than I ever dreamed of, and not just with anxiety, but many other health issues, too.
Today, we have more than 30 employees, an e-commerce division, two retail locations with a third in the works, a growing wholesale division and a 1,200 square foot manufacturing facility with a dedicated lab for formulation.
Can you share the most interesting story that happened to you since you began leading your company?
One of the things we learned early on is government agencies (DEA, FDA, EPA) were interested in what we are doing, and we had to figure out how to follow their rules. In our experience there has been quite a bit of conflicting information about what is okay and what’s not, so that has been a definite challenge.
Even now that the Farm Bill has passed, making it legal to grow industrial hemp and sell the products made from it, some state health departments have different rules about how those products can be used. For example, in Michigan, the health department says you can sell a bottle of CBD oil in a coffee shop, but you can’t sell coffee with that same CBD oil added to the cup.
We are in the Wild West phase of this business, and it is constantly evolving.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?
One of the ridiculous things I did early on was shipping our products using hand-printed shipping labels. It made sense when I was selling one or two bottles a month — even a couple a week — but suddenly I was filling 100 orders or more a day and still creating labels by hand. I was constantly running out of supplies and running to OfficeMax for more. One day I thought there had to be a better way and could only laugh at myself when I saw how many shipping label printers I found online with a single search.
Are you working on any exciting projects now?
We just launched a new line of products including a roll-on CBD salve, as well as a CBD patch which lasts up to 12 hours. We have some other new products coming soon as well, including new confections and more pet products. We have a third retail location in the works, slated to open this spring, in addition to the location in Elkhart, Indiana and our retail outlet in Jenison, Michigan at our headquarters.
Our building seems to be perpetually under construction as we create space for additional employees, and as we expand on our manufacturing facility to add new equipment.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
My grandmother, Dorothy, has been a great inspiration all my life. She passed away a number of years ago, unfortunately, but she’s the one who taught me to tune out the people who try to discourage me and really go for my dreams. She was such a force in life and a very entrepreneurial woman, particularly for her generation. Dorothy started many different businesses in her life, including a restaurant, a pool hall, a baseball card shop, a ceramics shop, and a diner. I carry her memory with me every day. I know she is smiling down on me, is proud of the business I’ve created, and how many people we are helping.
This industry is young, dynamic and creative. Do you use any clever and innovative marketing strategies that you think large legacy companies should consider adopting?
There is a lot of misinformation around the CBD industry, it’s very misunderstood (i.e., it’s not marijuana and it cannot get you high). We have found the most valuable marketing tool we have is consumer education. Since the beginning, Made by Hemp has focused on providing valuable information about hemp and CBD, all backed by reliable sources.
One of our core values is doing the right thing, so we are committed to doing that in our marketing, as well. We help people understand what CBD is, and what it is not. For instance, there are companies making claims that CBD oil is a panacea, or a “cure all”, for everything that ails you. This simply isn’t true, but it does have proven value as an anti-inflammatory and a calming agent. There will be much more research in the years to come, now that the restrictions on hemp have been lifted, and we’re excited to see those results.
We find that many of our customers consistently come back to our website for more education and that is a definite win for us.
Can you share 3 things that most excite you about the Cannabis industry? Can you share 3 things that most concern you?
What we’re excited about:
- The possible benefits of CBD oil and the research on other phytocannabinoids. There are many others (aside from CBD and TCH) that naturally occur in the cannabis plant and we have not scratched the surface of those yet.
- Seeing all the businesses and opportunities created in and around this industry. More and more pop up every day, and it’s exciting to see the new products that are being developed and the jobs being created because of it.
3. The number of people being helped with health and wellness issues in a natural way. I started this business with a goal of helping people; today I hear stories daily about how a CBD or cannabis product has changed someone’s life like it did mine, and that is both humbling and inspiring.
What we’re concerned about:
- People still conflate CBD with marijuana, believing that both products get you high, and that is a tough stigma to overcome. There are people now selling hemp flower “joints” which sends the wrong message entirely. Hemp flower joints look and smell just like a marijuana joint, but hemp cannot get anyone high.
- Like every industry, there are some bad actors looking to cash in on the CBD oil business by cutting corners and in some cases, cheating people. With CBD you truly get what you pay for, so it’s vital that consumers know what they are buying and where it was sourced. At Made by Hemp, every product we sell comes with a Certificate of Analysis (COA) from an independent lab and a money back guarantee. Be wary of people selling you very cheap CBD oil products as they may come from China or not contain any CBD at all. Ask to see the lab test.
- Be wary of products and companies that claim CBD oil can cure everything that ails you, from headaches to autism to cancer. We know CBD has been proven to be calming and an anti-inflammatory, but it’s just one part of a healthy lifestyle.
Can you share your “5 Things I Wish Someone Told Me Before I Started Leading a Cannabis Business”? Please share a story or example for each.
1. People will think you’re a drug dealer. When I first met my wife, she thought my business was a cover for a marijuana operation. Expect to spend a lot of time educating people about what CBD is, and more importantly, what it isn’t.
2. Carefully sourcing your hemp is critical to creating a good CBD oil product. The plant itself can grow roots more than 8 feet deep and it’s a soil remediator, meaning that it will pull any pesticides or heavy metals out of the ground and into the plant. When I first started, the only option was to source plants from Europe. Today, all our hemp comes from American farms. Building good relationships with your chosen wholesale supplier is key to creating quality products.
3. You need to be prepared to deal with government agencies and stay on top of regulations, because they can change quickly and may vary by state. As I mentioned above, even now that the 2018 Farm Bill has passed, making it legal to grow industrial hemp and sell the products made from it, some state health departments have different rules about how those products can be used. As mentioned before, look at Michigan: the health department says you can sell a bottle of CBD oil in a coffee shop, but you can’t sell coffee with that same CBD oil added to the cup.
4. Competition is only going to get more intense now that hemp is no longer a restricted crop. When I first started Made by Hemp in 2013, banks could not legally give us financing for the business because hemp was a controlled substance. Now, many individuals and companies are looking to cash in on the CBD oil business, so it’s vital to build a strong brand and continue innovating.
5. Growing a successful company requires more than producing quality products. Building a solid work culture where people feel free to collaborate and innovate is key in an industry like this, which is constantly changing. At Made By Hemp we are focused on creating a great culture where top performers want to stay, and that means learning how to communicate with people from different generations and with different skill sets.
What advice would you give to other CEOs or founders to help their employees to thrive?
Company culture is everything. It’s vital that you avoid a top-down hierarchy and allow your team to communicate and collaborate. In this business you constantly need to be learning and stay prepared to pivot when needed. We have benefited from working with business coaches and peer groups from entrepreneurial organizations. Our leadership team is always learning and growing, and we encourage the rest of our team to do that, too.
We have had good success with the Entrepreneurial Operating System (or EOS). It has helped us create systems and have the most productive meetings I’ve ever been in. When we first started, my one employee and I would go to lunch once a week, and that was our only meeting. But once we got up to ten employees, we needed to put a system in place. We are poised for exponential growth in both our wholesale and retail divisions. Having systems and processes in place like EOS will help us get there much faster and more smoothly.
You are a person of great influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
It sounds simplistic, but honestly, if I could inspire any movement, it would be to encourage people to be nice, assume the best in others and get along. One of the things I love about the CBD industry is that it’s one big melting pot and everybody is welcome, as long as they’re acting in good faith.
What is the best way our readers can follow you on social media?
On Instagram @MadeByHemp
On Facebook @MadeByHemp
Or connect with me on LinkedIn: https://www.linkedin.com/in/jeff-gallagher-473b0253/
This was very inspiring. Thank you so much for joining us!