By Javier Hasse, Nina Zdinjak and Alex Oleinic.
The booming U.S. CBD market is estimated to exceed $20 billion by 2024, according to BDS Analytics — a substantial jump from $1.9 billion in 2018.
As CBD becomes mainstream, companies operating in the space are establishing themselves in a new environment and are not just competing among themselves, but also with larger and older conglomerates in the industries that CBD has recently penetrated.
One way that CBD businesses are adapting to the market growth is by hiring top talent from successful companies in other industries.
Benzinga recently sat down with Erick Dickens, the co-founder and CEO of Kadenwood Brands, who prior to CBD had a successful marketing and brand management career at a number of companies, including Kraft Foods.
From Marketer To CBD Entrepreneur
Prior to entering the business world, Dickens served as a pilot and commander in the U.S. Army for eight years.
After the army, he started working in marketing at Kraft Foods, driving growth for brands like Henkel, Post Cereals, Soft Scrub, Renuzit and Right Guard.
After Kraft, Dickens moved on to LifeLock, spearheading the company’s branding and product development, which contributed to a doubling in sales and a successful IPO.
He also spent five years at King’s Hawaiian, where he helped the company double its revenue and built a marketing function and strategy from scratch.
For his efforts and a marketing career that spans over more than 20 years, Dickens was recently chosen for the inaugural Forbes CMO Next list of 50 top marketers.
Earlier this year, Dickens moved to the CBD space and co-founded Kadenwood Brands, a consumer products lifestyle company that aims to shape CBD into a trusted, mainstream wellness category.
The company's potential for success lies in its powerful combination of professional CPG marketing and category innovation expertise — and industry-leading vertically-integrated CBD farming, Dickens said.
Kadenwood is about to launch its first collection of branded products in personal care, LEVEL SELECT.
All CBD oils under the Level Select brand use plants from the company’s U.S. hemp farms.
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People Shape The Company
One of the pillars of Kadenwood’s success is the leadership team that established the company, Dickens told Benzinga.
"Todd [Davis, Kadenwoood’s chairman] successfully started LifeLock, defined a new category and built the brand into a household name and industry leader. Todd led the company to a successful $1-billion IPO and then a $2.3-billion sale to Symantec."
Dickens also praised Kadenwood’s chief operations officer, Doug Weeks, who previously managed personal care businesses at Henkel and the beverage business at Kraft, where he launched the Mio drink supplement business.
“Following his role at Kraft, Doug helped start Core water, which recently sold to Keurig Dr Pepper for $525 million. Doug also started [the] Outlaw Energy and Purity Organic beverage businesses.”
One of Kadenwood's main sources of hemp and CBD expertise is General Manager Brian Newberry, Dickens said.
“Brian Newberry is a foremost leader in the CBD space. He has built one of the nation’s largest seed-to-shelf CBD genetics, farming and processing capabilities with state-of-the-art track-and-trace.”
Successful Fundraising Without A Product
In an industry where many companies struggle to fundraise, Kadenwood has $10 million from friends and family before launching a product.
“Our $70-million pre-money valuation was based on the value of our 300 acres of farmland and new product concepts/sales projections,” the CEO said.
Dickens said he finds the industry to be favorable for fundraising, with the only challenge being people who are not familiar with what is legal and what is not; or, in other words, the difference between hemp-derived CBD and cannabis.
Plans To Go Public
In the next two years, Kadenwood plans to invest $50 million in developing its brands, after which it’s considering an IPO, Dickens said.
The company will use most of hte funds from product sales and farming operations for large-scale advertising, he said.
Kadenwood is open to considering mergers or other forms of industry consolidation, as it plans to grow its farming operations and enhance its vertical integration capabilities, the CEO said.
Dickens relies on his previous experience, saying that the current work is similar to the things he and his team have done already.
"We are not in the marijuana business. We are building national consumer branded products that will define the CBD space."