POST CATEGORY: Profiles

AK Cannex: The Alaska Cannabis Commodities Exchange

July 04, 2017 | WES ABNEY

AK Cannex founder Loren Dreyer started a website for licensed cultivators and processors to facilitate wholesale exchanges of marijuana. Photos by Oscar Avellaneda-Cruz.

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When did you have the idea to start a Cannabis exchange?

It was my daughter’s first birthday and June of last year and at that moment I knew what I wanted to do. I read all the Cannabis news outlets everyday, and I was seeing these other exchanges starting to hit different markets and I started looking into them and researching and realized there was nothing like it here in Alaska.

You saw a need before anyone else in the market. What drove this for you?

 I was already starting to look further out to when I opened my little grow how can I sell plants, my trim, my flower. It was very obvious that there was going to be a need for a centralized wholesale hub where people could post and sell their products to licensed businesses.

When did the site go live? What was the response like?

Our site became live in January. It took me six months to get it built and to do our own internal testing. At that time, not many people were licensed, even now the industry is still just getting off the ground. It was a slow trickle early on. At first it was retailers that wanted to register to see if there was product available and then more and more people started signing up each day. We have almost 40 percent of the market of current licensed Cannabis establishments in Alaska signed up.

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40 percent of the current market is a great accomplishment for six months of being live. How does that feel?

It’s exciting, people are starting to use it more and more. There’s been big wholesale growers that use it and put entire harvest on there, so we serve as their sales division, myself as a grower I’ve sold batches of clones to retail stores and growers, we’ve seen trim on there, we haven’t seen any edibles on there yet, but we’ve seen genetics, trim and flower.

So far you have managed to keep the service free. Why did you want to offer it that way?

I have a cultivation license and I know how long everything has taken so when I got to point where we were set up the last thing I wanted to do was hit people with another fee. So I made it free to make it easy for everyone to use and adopt, and while we will at some point have to start charging, or generate money with ads, we will give it through summer of 2018 free and adjust from there. I’d like to keep it free forever, but it’s a matter of operating capital to make the site better.

What does a transaction look like through the site? Let’s use you as an example.

Let’s say I produce 40 to 50 clones every week to support my operation. I have an excess and instead of throwing away clones, I sell them. So I take a photo of the batch, I post the batch online based on the price and post it. I can choose to put a set price on it or I can put it up for auction, set terms and then retailers or growers would see the post and submit bids. The seller sees the bids coming in through their profile, so buyers can go through and see which growers bid and how much. The seller chooses a final bid point or accepts an offer, and at that point buyer and seller send a purchase agreement, they both sign and then it is up to them to execute. So, if they signed for transportation then they figure out pickup and delivery and the transaction is handled.

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Do growers always pick the highest price? What kind of prices are you seeing?

Generally we see people take the high price but it’s not always the case, about 25 percent of time sellers pick and choose and are not as concerned. I was surprised by that, but a lot of people want to tailor their distribution, so the sellers can really fine tune their distribution strategy with us. You can see bids from all over the state, and really understand the marketplace before making a choice.

What do you see as the future for AKcannex?

I see sellers using AK Cannex for everything! It’s a sales department for a business basically— you post it on there and all negotiating is done. You don’t have to call a bunch of people or go back and forth on terms, it’s all easily communicated. It saves so much time, it cuts out hours a week. I want it to be a free service that saves everybody time and makes things less stressful.

You also just opened your retail store! Congrats! Tell us about that.

It's my cultivation and retail facility. It’s a small little 1,400-square-foot facility, a 1,000-foot grow and 400-foot retail store.

I came from the medical market here in Alaska, I was a grower and knew growers, so I’m trying to target the home grow market, I want to sell genetics, mostly clones, maybe someday seeds, but I’ll be able to turn out a lot of clones and support home grow. I’ll grow here, I’ve built everything in my cultivation system to be simple and automated to keep costs down and be able to pass those costs savings on to consumer. I won’t have my first harvest for another few weeks, but right now I have a few strains like a GG cross, Moose and Lobster, Candy Kush, Candy Caramel Kush, Huckleberry Death Star and a handful of other strains going too.

How did it feel to finally be open and operating?

It was great. It was quite a relief, to finally get there and be able to start having money coming in. Oh yea, I’m feeling good, I’m excited to be open every day, and be a healthy competitor in the market here.

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