Expanding nationally, Greenhouse cultivates new ‘green’ opps

The beverage company's CEO Anthony Green explains how a new line of CBD-infused beverages will support its wellness mission.

Greenhouse

Greenhouse has been growing as quickly as, well, a weed.

Since its founding in 2014, the company has transformed from a single standalone shop in Toronto into a network of 15 company-owned stores (with nearly 100 more points of sale), expanded its portfolio to include six different lines of “functional beverages,” and dropped the “Juice Co.” from its original name to reflect its wider product portfolio, becoming simply Greenhouse.

That name, as its founders have casually pointed out, made further expansion into another, emerging “green” business too difficult to resist.

This week, in addition to announcing plans for a national expansion, the plant-based beverage brand revealed it’s developing a line of Cannabidiol-infused beverages, increasing its presence in the plant-based wellness space and tapping into a trend that has many players, from brewers to soft drink giants, vying for a piece of what is likely to be a very large pie.

The company has just struck a strategic partnership with Canopy Growth-affiliated Canopy Rivers, which will support Greenhouse’s future growth through a $9 million investment. In doing so, Canopy becomes the first non-founding partner in the business.

Greenhouse productionResearch has demonstrated the wellness potential of CBD, the non-psychoactive compound found in the cannabis plant, says Anthony Green, Greenhouse co-founder and CEO. “It’s something that we’ve been half joking about for quite some time, the notion of cold-pressing the actual [cannabis] plant.”

Green first read about the anti-inflammatory qualities of CBD back in 2014, but began more seriously thinking (with co-founders Emma Knight and Hana James) about how to incorporate it into the business in 2017.

“Greenhouse, from its outset, its mission has been around plant-based health,” Green says. “There certainly isn’t another plant that we can think of that is more of the moment and that, in this day and age, is so well-positioned in the wellness space.”

The line is still in development, and although cannabis was legalized in October, products like beverages, edibles and vaporizers won’t be made legal until later this year. That’s when Greenhouse plans to begin selling its line of CBD beverages through provinces’ respective distribution points.

“That will be a new distribution channel for us, but ultimately, in the long run, we’re hoping that we’ll be able to leverage our present omni-channel distribution, our shops, our wholesale customers, grocery, retail, food service and direct-to-consumer with CBD products,” says the company’s CEO.

In recent months, a number of major brands have made known their intention to enter the CBD space.

In December, cannabis company Tilray announced a partnership with beer giant AB InBev (through its Canadian subsidiary Labatt Breweries of Canada) to research non-alcoholic beverages infused with THC and CBD. Competitor Molson Coors paired up with Quebec licensed producer Hydropothecary (now known as Hexo) in August, establishing a joint venture to explore the development of alcohol-free CBD beverages. Meanwhile, alcohol-free beer and wine brand Hill Street Beverage Co. is eyeing the same market, just as Coca-Cola was expected to be doing through a partnership with Aurora Cannabis – although Coke’s CEO John Quincey has since tempered those rumours.

Greenhouse flagshipWhile the rise of CBD products presents an opportunity for established companies to spur growth through categories outside their traditional wheelhouses, for Greenhouse, the component’s wellness properties feels right at home. Green says the company’s plans are not so much about expanding its existing customer base, but rather about helping those customers to meet the latest wellness trend.

“The demographic that we’re appealing to today aligns really well with the demographic that already knows what CBD is, has done the research, understands what the endocannabinoid system is, and the non-psychoactive role that cannabis can play in a healthy lifestyle.”

By 2020, the company is aiming to have 1,500 points of sale through its own stores and through distribution deals with retailers and other shops.

The launch of Greenhouse’s new distribution system and “light filtration” process last year helped ramp up production, and products are now available in Loblaw and Farm Boy grocery stores, 56 Sobeys locations and Avril Supermarché stores in Quebec. Later this month, they will become available in Rachelle Bery health stores in Quebec, with further expansion into eastern and the western Canada in the second half of the year.