Building Railroad Tracks for Cannabis: Will Brophy’s Mission Normalizing the Industry Through Nabis

Anthony Codispoti (00:00)
Welcome to another edition of the inspired stories podcast where leaders share their experiences so we can learn from their successes and be inspired by how they’ve overcome adversity. My name is Anthony Cotaspoti and today’s guest is Will Brophy, chief operating officer at Nabas. They are the number one licensed cannabis wholesaling platform offering distribution services and analytics across California, New York and Nevada.

They distribute over 400 brands and manage more than 9,000 products using a software enabled portal and a fleet of over 90 vehicles to deliver top notch service. Under Will’s leadership, the company continues to expand, supported by his background in operations and strategy. He has also held the role of head of operations at NavVis and currently serves on the board of the Cannabis Distribution Association.

Before joining NavVis, Will earned his Bachelor of Arts in Government from Harvard University, which sharpened his strategic thinking and problem solving skills. With a commitment to driving efficiency and compliance, Will and NavVis have earned recognition for revolutionizing the industry. Now, before we get into all that good stuff, today’s episode is brought to you by my company, Ad Back Benefits Agency, where we offer very specific and unique employee benefits that are both great for your team and

fiscally optimized for your bottom line. Now imagine, being able to give your employees free access to doctors, therapists, and prescription meds. And here’s the fun part. The program actually puts more money in your employees’ pockets and the company’s too. One recent client was able to increase net profits by $900 per employee per year. Now results vary for each company and some organizations may not be eligible.

To find out if your company qualifies, contact us today at addbackbenefits.com. All right, back to our guest today, the COO of Nabris, Will Brophy. Thanks for making the time to share your story today.

Will Brophy (02:05)
Thanks for having me, Anthony. Excited to talk to you.

Anthony Codispoti (02:07)
All right, so before we jump into Nablus and what you guys are doing there, I want to talk a little bit about your background. Graduated from Harvard, worked in a variety of fields, Ecom, food and beverage, travel industry. What was the most formidable stop for you along the way, Will?

Will Brophy (02:25)
Yeah, good question. ⁓ Maybe an unfair answer, but I’m going to give you a couple. think I stopped first at a place called McMaster Car, ⁓ which was a large industrial supply distributor. And I think it gave me an appreciation for just how difficult it can be to run a scale distributor. And then the stops in e-commerce and food and beverage really gave me…

an understanding of operational scale and how quickly customer expectations can move. And I feel like NavVis, I get to pull from a little bit of both. you know, trying to pull from everything I’ve done along the way, but yeah, definitely, ⁓ you know, it’s an interesting combination of building a scale distributor over time. So feel a little lucky. I got to work at a scale distributor and then build companies. And this is, this feels like a culmination of the two.

Anthony Codispoti (03:17)
And so what stage was Nablus when you joined them? Kind of give us an idea of the size.

Will Brophy (03:21)
NABIS, yeah,

absolutely. So it was fairly early days still. It was about 40 people in two small warehouses and we were really getting things off the ground. it was at the stage where we’d, I think we’d found product market fit. There was clearly a lot of demand for NABIS, but our demand was somewhat exceeding our technological and logistical prowess. So we were falling behind on orders and losing track of inventory.

So was still early days, but there was a lot of promise. And I think it was clear that the industry needed someone like Mavis. How we were going to pull it off was a bigger question for us.

Anthony Codispoti (04:01)
So how did the opportunity for you to join the organization come about?

Will Brophy (04:05)
Yeah, I actually knew June from college and I had been helping him hire for this role while I was working in finance in New York. And I found myself more excited about helping him hire than I was about my own role and really felt drawn to it. Sort of the mission of normalizing cannabis and supporting all these entrepreneurial brands really resonated with me. So yeah, I felt really drawn to it and you

Eventually my wife said to me one day when we were walking through Prospect Park, she said, you sound way more excited about this role than your real job. think we should move out west and yeah, the rest is history.

Anthony Codispoti (04:47)
Okay, so you were helping him hire specifically for the COO role or you were helping him hire for other roles in the company?

Will Brophy (04:55)
Yeah, it was to it was for their head of operations role that was really going to be their first key operations executive. June and Vince tell me they were trying to get me to come work at NavVis. I genuinely thought I was helping them hire. So who knows what the truth is somewhere in between probably.

Anthony Codispoti (05:11)
Okay, and you said you got excited about the mission of normalizing cannabis. Say more about that.

Will Brophy (05:18)
Sure, so I’ve always been a consumer of cannabis. I’ve always appreciated the plant. And I really loved the supply chain work that was gonna go into it. So it felt like a perfect marriage of the two. I think early it was clear to me that cannabis needed professional operators to come in. There’s clearly demand for the product and there was a lot of amazing operators, particularly in the brand and retail.

side of things, but they were missing some of these, you know, messy middle parts of the supply chain. And that happened to be where I was spending my time in my career. So I felt like I could really make an impact. And I felt like it was quite important to professionalize the industry ⁓ and really build a best in class supply chain so that we could normalize cannabis and make it normal. mean, particularly when I joined

Six or so years ago, there was still pretty heavy stigma around cannabis and there there is still in a lot of places But we’re seeing it fall away and I think you know, in the industry have a big part in that and the more we can professionalize Ourselves in the industry the more we can make it accessible to people who might not be so comfortable walking into ⁓ a building that doesn’t feel Medical to them, right doesn’t feel like a place where you can trust

And that’s really important is to build the trust of consumers to grow the industry.

Anthony Codispoti (06:47)
And so when we talk about normalizing cannabis and making people feel more comfortable around it, the perception that people have is sort of like back alley deals or, you know, maybe there’s a, a smoke shop that yeah, seems like someplace I wouldn’t really want to go into or send, you know, my, my wife into by herself. Is that kind of what we’re saying? And so wanting to sort of clean up the image and have nicer places for people to go and access the product.

Will Brophy (07:15)
Yeah, that’s a huge part of it. ⁓ A big part of it is just how it feels when you walk in the doors. There’s also the unseen parts around making sure that the supply chain is truly clean and we’re providing access to a wide range of choices that of products that really resonate with those people because you can have the perfect storefront, but if the products don’t speak to them, they’re, not going to feel like it’s accessible.

And then even a layer deeper than that, making sure the product is safe and effectively tested is critical. And it’s really important for the legal industry to keep working hard to grow itself. There’s not adequate testing in the traditional legacy market. ⁓ And particularly when I was joining about six years ago, it was right in the midst of what we in the industry call vape gate. I don’t know if you recall, but there was a slew of really nasty press around. ⁓

legacy market vapes and what they were doing from a health perspective. And it really highlighted a sort of splinter in the community where, you know, the folks that wanted clean, tested, accessible products and those that were operating sort of in the old school, more legacy market fashion, it really caused a splinter and yeah, it made it important, I think, for people to come in and make sure that the legal market could be competitive, could stand up against the legacy market.

Anthony Codispoti (08:37)
like that the legacy market, what a nice way to refer to it. ⁓ And what was the the specific issue with the the vapes from the legacy market?

Will Brophy (08:47)
Yeah, I mean, you could get a different answer talking to a lot of people. I think the short answer is that, you know, the way a lot of vapes are made, there’s a lot of combustible material and chemicals that are not great for you unless you do it the right way. ⁓ You know, people cutting corners without adequate testing can lead to pretty bad outcomes when it comes to vapes in particular. And I think…

It’s just really important that people can make informed choices and know exactly what products are in the vape they’re using. And I think when you get it on the legacy market, you’re not gonna know what’s in there. And I think that’s a lot of what was happening is sort of additives that would not be approved in the legal market that were in there and doing quite a bit damage.

Anthony Codispoti (09:37)
And so what you guys are able to do differently is you have that test and you’re not cutting the corners. You’ve got labels on the products. People know what it is that they’re getting.

Will Brophy (09:47)
Yeah. And the industry is still not perfect. It’s making strides over time, ⁓ you know, independent third party testing, ⁓ chain of command the whole way, ⁓ really just sort of treating it like pharmaceuticals or alcohol, but have strict regulations. ⁓ it is important cause you know, I, I won’t sit here and tell you that red tape is necessarily fun for the industry. ⁓ but we’re talking about stuff that people are inhaling and ingesting and it’s, it’s just absolutely critical that they know exactly what they’re.

taking.

Anthony Codispoti (10:18)
So paint a picture for us on where Nabis sits in this whole ecosphere. Do you guys own shops? Do you own brands? Do you have grow operations? Kind of paint the picture.

Will Brophy (10:32)
Sure, so it varies state to state ⁓ a little bit, but the core of it is that we’re distributors with a supply chain technology ⁓ stack that sits around distribution and provides other value added services. So there’s a couple ways to look at the supply chain in cannabis. There’s the sort of technical steps ⁓ from the cannabis side and that reflects more closely the licensing in cannabis. So from that side of things you have

goes from cultivation to processing or manufacturing called different things in different states. And then it typically goes to distribution and then retail. So those are the four main legs. In reality, when you then look at like ownership structure of those products, it’s typically brands, distributors and retailers. And the brands ⁓ will own portions of ⁓ cultivation and manufacturing or not. There’s a million different iterations. Some brands,

own all of their cultivation and their processing or manufacturing. Some own one or the other and some own neither and work with trusted partners to bring the products to market. So we sit in that distribution phase. So really, where we’re coming in is we’re aside from the technology solutions that really can reverberate throughout our partner’s supply chains.

Our core ⁓ interaction is to take products from the manufacturing or processing step. We hold them, warehouse them at our facility. Folks then place orders against that inventory that are delivered to licensed retailers and delivery services. And then we collect capital from those retailers and remit it back to our brand partners.

Anthony Codispoti (12:18)
Got it. So you’re not doing the growing and the cultivating. You are taking other people’s brands. think in the intro we said 400 different brands and 9000 skews, which is, you know, kind of mind boggling. And then you are ⁓ as the licensed retailers need these products, you’re making that delivery, collecting the funds and then getting the funds back to the brand owner. Right.

Will Brophy (12:21)
Nope.

Yeah, yeah, at least.

Yeah, exactly. So you could think of us, you know, there’s other parallels. We’re definitely, I think, different in a lot of ways. But if you think of like Cisco and food, for example, a large food distributor or, you know, many of the large alcohol distributors from like a supply chain perspective, that’s essentially where we sit. We do some different stuff in terms of how we try to support our brand partners and our retail partners. But that’s the sort of basic idea.

Anthony Codispoti (13:12)
I’d like to hear more about how you’re doing some different things to support both the brand and the retail partners. That might be interesting to explore.

Will Brophy (13:18)
Sure, ⁓ so we try not to just deliver product, we try to provide a full stack solution. So we do the logistics and the logistics are critically important. If you can’t do those well, the rest of this is ⁓ sort of dressing up a pig. But we also do financing through NavVis Capital, which is invoice factoring, critically important to getting cash flow to certain brand partners.

We do marketing placements through our marketplace and in California, for example, our marketplace share alone accounts for 25 % of our wholesale volume. We do an extensive amount of analytics for our brands to help support their sales initiatives. Those are the big areas, but we’re constantly expanding.

Anthony Codispoti (14:06)
And you’ve mentioned the importance of technology and what you guys are doing multiple times. I’d like to hear more about that. What is so special about what you guys are doing in the tech stack?

Will Brophy (14:11)
Yeah.

Yeah, I mean, look, we try to introduce modern technology to ⁓ the distribution world, which is typically a little bit antiquated. there’s the basic ways where it helps to drive efficiencies. ⁓ That’s really important for us internally and to sort of leverage tech to build a really truly optimized set of processes that build to something that’s effective for our brands.

A lot of where the tech comes in is outward facing for us. you know, we really, one of our core missions is to provide access to cannabis and let the market choose what’s gonna stick with them. ⁓ We believe that drives innovation. We believe that drives the best product offering for customers, which in the end is good. Whereas you’ll see a lot of more traditional distributors.

They have limited technology. They need to keep a narrower set of brands and SKUs. And so they’re serving more of a curation function. Whereas we try to provide a platform function that lets the market decide and lets the consumer decide what products resonate with them. And really it requires that technology to do it, right? We emphasize self-service technology for our brands.

⁓ For example, we have a sales rule on our platform that allows brands to customize almost 2,000 different unique pricing rules ⁓ so that really brands can choose their own adventure on our platform. And it lets us carry way more brands without running into principal agent problems.

Anthony Codispoti (16:04)
So you said when you first joined Nabas, there about 40 employees, there were some challenges. You guys were losing some orders, things were getting slowed down. ⁓ I think today you’re probably about 10 times that size ⁓ in terms of ⁓ head count.

Talk through just one specific example of a tech implementation that you put in place. Here’s the problem that we had. Here’s what we did. Here’s how it’s better on the other side.

Will Brophy (16:37)
Sure. ⁓ So I think one of the really interesting challenges in the cannabis industry is collecting cash. It’s an industry that has traditionally some cash flow problems ⁓ for a variety of reasons. I think the most salient probably that it’s a new industry. So you have a ton of ⁓ young new businesses who typically struggle with cash to begin with. And then when you factor in how hard it is to access cannabis or capital as a cannabis company.

There’s a lot of cash strapped retailers that we’re selling into or that our brands are selling into and we’re delivering on their behalf. And one of the challenges at Nabas, so a traditional distributor will buy and sell inventory and they therefore control who they’re selling into versus not. We don’t do that. We don’t buy and sell inventory. Our brands retain title to their product and use our platform to choose where to sell into.

Where it’s hard is, you you have a little bit of disconnect then between the incentives of the accounts receivable team, the incentives of the delivery drivers and the incentives of the salespeople of those brands. And it was a challenge to get through, you to get all the sales that they were looking for and do it in a way that we could actually collect on those orders. And, you know, it’s a little bit simpler when they’re all under one roof, right? Everybody’s on the same team. You can make calls. can…

your AR team can just put controls in place that dictate the behavior of those drivers and those sales reps. And you can call one sales operations meeting and crack some skulls and really get everybody aligned. It’s harder for us with those across different teams, but it’s still critically important to make the right choices when it comes to AR. So we were having frequent issues where there was just too many bespoke requests.

They wanted us to be able to collect on an invoice before we delivered a new one. And it was really hard to take their needs and translate them from 300 different brands and 300 different styles of needs and to translate that into something that was actionable by our delivery drivers. So what we built was, you know, further sort of choose your own adventure features for accounts receivable. So.

Now, when you go on our platform, particularly in California, we have something called a must pay prior balance feature. And what that does is when you’re placing your order on NavVis, you can say, all right, we’ll give them, you know, we’ll give them 30 days of credit on paying for this invoice. But delivering this invoice is contingent upon collecting the past due invoice of this invoice or that invoice, or they can run it as a credit limit in our system.

There’s a bunch of different ways for them to choose their financial exposure right on the ordering platform so that they they’re in control and it’s our guys will show up and they’ll they’ll deliver and collect as told but the tech really lets the brand choose how much exposure they’re willing to take first not and where that’s really helpful I think is not just in getting the work done, but it also puts the power of choice in them in the brand’s hand because

We have some brands who are counting every dollar and they don’t want to deliver anything that has any risk of default on that credit, right? Every dollar that they don’t collect is a huge problem for them. They should have the right to build their sales strategy accordingly. We also have other brands who are blush with cash and they care way more about market share than they do about collecting every dollar. That’s also valid if that’s how their organization is set up. So,

By building tech that really lets people self-service and choose their own adventure there, we’re able to service two different profiles of customers and do it in a way that’s authentic to their needs and lets us embed in their supply chain instead of trying to dictate a cohesive sales strategy across two different orgs that maybe don’t have the same needs.

Anthony Codispoti (20:43)
So the difference today is people can still have sort of different requests of you in terms of how to handle those accounts receivable. It’s just now you get the technology layered in place so it’s not like a post-it note somewhere that says, ⁓ this brand, we got to collect before we deliver the next order. Am I understanding that correctly?

Will Brophy (21:02)
Yeah. And really put simply what I think, I think the way I would think about it is that traditionally distributors don’t carry many brands because they all have bespoke needs and requests, right? They all want things done in different way. And as an operator, that’s really hard to do. So you typically limit your scope of brands so that you can, you can sort of wrangle all those externalities.

At NavVis, we try to build the technology in a way that lets us take a ton of different needs, but run it through a core flow ⁓ so that while we have 300 different brands with, know, 400 different brands with a wide variety of needs, it’s all getting built into a system that’s scalable and consistent so that our operators can actually execute on.

Anthony Codispoti (21:51)
And so since you’ve put the tech in place to solve this issue, what does the operator see that’s different for them? Is it just that, the communication on how the collections should be handled for this client are just much more crystal clear and kind of upfront?

Will Brophy (22:09)
Yes, our drivers will, for example, they have a delivery app that we’ve built native and it walks them through what they need to do at the retailer. Now being a driver in the canvas industry still has lots of challenges. So it’s not to say it’s easy, but they pull up their driver app and it tells them, Hey, delivering this order in order to do so, you need to collect this order in this order, or you don’t have to collect anything. ⁓ so for them, they really just need to follow the guidance of a delivery app, but it’s

It’s basically taking a bunch of different risk profiles, decision-making profiles that are made at the brand level. And it’s all getting filtered down through that app instead of being a series of delivery notes that are drivers left to interpret because we’re asking our drivers to make sense of 300 different sales and AR strategies in a sort of ⁓ qualitative notes field, which is not really reasonable.

Anthony Codispoti (23:04)
Gotcha. Okay. I understand that now and I can see how that would be a lot more helpful. Will you said something about how hard it is for cannabis companies to access capital. Why is that?

Will Brophy (23:16)
Yeah, I mean, at its core, the main reason is that a lot of capital ties back to federal institutions and cannabis is federally illegal. So, you you want to rent a building and the mortgage is underwritten by Chase Bank or one of the large federally backed ⁓ banks. You can’t do it. ⁓ You want to apply for a federal program. You can’t do it.

Yeah, banking access is quite bad in cannabis. We’ve been lucky to find good partners, but it’s not that easy for everyone. ⁓ So yeah, it really comes back to the fact that it’s a federally illegal product and that ripples throughout banking, maybe more profoundly than other areas.

Anthony Codispoti (23:59)
So how does one who’s in the cannabis industry find access to banking?

Will Brophy (24:06)
through hope and a prayer. You know, there’s, depends on the state you’re in. Some states have done a really good job of backing and chartering banks ⁓ and basically saying we will sign off on the fact that these are compliant operators. That’s originally how we built a relationship with our bank ⁓ that’s in California called East West Bank. The state basically said we will vouch for them as legal operators and they went and they chose a pilot group and they’ve been.

fantastic partners to us. Not every state has that. So yeah, it really depends. ⁓ A lot of people in cannabis, just being honest, have to have some degree of capital upfront on their own, or it’s not viable. ⁓ You can’t go in with a business plan and ask your local bank for 2 million bucks to start a cannabis company. That’s not really viable. ⁓ So you basically have to have some form of startup cash.

or find an angel investor to get things rolling. And then once you’re closer to profitable, can work with some regional banks, particularly are ⁓ typically not domiciled out ⁓ of a state where it’s gonna be a major problem. But yeah, it tends to be more regional banks and private credit ⁓ and angel investors ⁓ less, you know, going to your local chapter of a large national bank.

Anthony Codispoti (25:30)
So the banking relationship that you have there in California, is that something that you’re able to utilize for the operations in Nevada and New York?

Will Brophy (25:39)
Yeah, they’ve followed us across states now. So they’re an awesome partner for us and there’s other folks out there, but ⁓ yeah, it’s not easy to get there.

Anthony Codispoti (25:50)
What are some of the other logistical challenges aside from accessing capital or just accessing a bank that people wouldn’t realize that cannabis businesses have to sort of get creative with?

Will Brophy (26:03)
Yeah, I think one of the simpler ones is just the regulatory challenges that come with shipping a controlled substance. So we have pretty intensive track and trace platforms in more mature states, and we have to log everything. Every unit in, every unit out, and everything along the way. ⁓ They implement these seed to sale programs is what they call them.

And it’s a pretty large compliance burden. yeah, it’s, you know, think of what you would imagine a pharmaceutical industry looks more like. ⁓ So that adds a layer of complexity, particularly for younger companies. ⁓ And we’re aggregating across the whole industry. So we get to ⁓ see small and large companies and there’s unique challenges on both sides with track and trace. ⁓

The other big one I would say is just the changing regulatory environment. ⁓ I’ve worked in quite a few industries and they have odd regulations across the board, but I’ve never worked in an industry where those regulations are changing as quickly as cannabis regulations are. So, you know, as soon as you feel like you have your head around the regs in one state, they’re probably changing ⁓ and in meaningful ways. So that always keeps everybody on their toes.

Anthony Codispoti (27:27)
Do you guys have access or trouble accessing I don’t know, like even basic things like payroll solutions or benefits or I don’t know if you guys do retirement plans. Are those things kind of locked out or do you have solutions for those two?

Will Brophy (27:45)
Both. We have to work pretty hard to find good partners that are comfortable with cannabis. It’s getting better over time. When I first started, we couldn’t work with probably 90 % of software providers, ⁓ HR benefits, retirement benefits, all the way down to just random software vendors, ⁓ warehouse management softwares, ⁓ random expense filing softwares. There’s tons of restrictions.

More and more folks are open to cannabis companies, but it’s taken quite a bit of time. And I would still say there’s a pretty large filter set upon all vendors, whether they’re willing to work with cannabis or not. ⁓ yeah, we’ve, mean, banking solutions, we’ve had a lot shut down and then had to restart. So ⁓ yeah, there’s definitely, ⁓ there’s definitely still restrictions and it’s just an added layer of, you know, needing to pick.

Anthony Codispoti (28:35)
Okay.

Will Brophy (28:44)
pick up all your toys and go somewhere else more regularly than you might have.

Anthony Codispoti (28:49)
And so is it still largely a cash-based business?

Will Brophy (28:53)
Not entirely. I mean, so it really depends who you talk to in the industry. There’s some retailers that are still pretty cash heavy. ⁓ We definitely take in a lot of cash from those retailers ⁓ and we get it into the banks as quickly as possible. We think the more the industry can move towards digital solutions, the better. Cash is not great for anyone, but there’s still quite a bit of cash. So we have ⁓ cash pickup services and…

we clear a lot of that cash into the banks. But yeah, it’s a dwindling percentage over time. And we found the new markets as they’re coming online are a little bit cash light compared to California. California still has a pretty heavy cash footprint. But like New York, for example, Nevada, most things are done digitally. So we’re hoping that’s the future safer for everyone.

Anthony Codispoti (29:42)
Okay.

You know, you were drawing the comparison to the pharmaceutical industry and I don’t think you have direct experience working in that industry, but I’m sure that you’ve talked with folks. Do you get the sense that the red tapes or the requirements for the cannabis industry are about the same or more intense than pharmaceutical?

Will Brophy (29:51)
Nope.

Yeah, similar, I think is my understanding. ⁓ think, part of what makes it hard to compare, honestly, is that ⁓ vast majority of the players in the pharmaceutical industry are scaled beyond what any of the players in the cannabis industry are. So there’s just not a lot of mom and pop pharmaceutical companies. And the cannabis industry is built on the back of mom and pop brands and mom and pop shops.

Anthony Codispoti (30:07)
Okay.

Will Brophy (30:31)
⁓ So it’s a hard comparison. think they’re fairly similar ideas. ⁓ Cannabis law tends to be something of a mix between the liquor industry and the pharmaceutical industry. I think they do have pretty similar track and trace programs. I mean, we’ve worked with a warehouse management software company in the past ⁓ who has pharmaceutical clients. it’s a lot of the same things. You have to track everything down to the lot level.

nothing can get lost, everything that’s, if there’s any issues, it has to get reported back to the state immediately. So same kind of ideas. My impression is on the pharmaceutical side, most of the players are scaled. So a lot of these tracing issues are just integrations with a large ERP program, whereas in cannabis, more people are doing them manually still, but it’s the same kinds of requirements.

Anthony Codispoti (31:25)
Okay, well, I appreciate you sort of taking that little sidebar with me to explore some of the unique challenges that you guys are enduring in the cannabis industry. mean, every business has its challenges. You guys have those, but then you have all of these other barriers because of the, it’s legal at the state level, it’s not legal at the federal level, some people don’t want to work with us, and that adds a lot of complications. But clearly there are people who are excited about Nabis. You’re one of them. There are lot of, you’ve got,

Will Brophy (31:29)
Sure.

Yeah.

Anthony Codispoti (31:55)
hundreds of people that work for you and they’re excited to be there too. Why do you think that is? Why do you have such an enthusiastic workforce?

Will Brophy (32:03)
Yeah, I think there’s a few angles. ⁓ know, cannabis industry itself is really exciting. ⁓ People appreciate the product. know, cannabis consumption in the States is ⁓ quite high. So there’s clearly the plant resonates with people. And I think people are excited to work in a new emerging industry where not everything’s set in stone and there’s a lot of opportunity. ⁓ I also think ⁓

Yeah, I also think, you know, finding an industry that has growth promise is really exciting for a lot of people because when you look at a lot of, you know, industries across the States, there’s, there’s quite a few that are in decline. ⁓ and I think people are, especially as times have gotten tougher, people are acutely aware of whether they’re joining an industry with, with hope or with a decline in the future. And I think people want to be a part of that. ⁓ I also think, you know, it’s a,

It’s an exciting thing to get to work at a company that you can be your whole self at. And not to say we’re perfect, but, you know, I talked to so many colleagues who have consumed cannabis their whole life and always had to hide that from their colleagues. And when they, they realize they can actually just be open about, you know, consuming cannabis. ⁓ We obviously don’t consume in the workplace, but they can share with their colleagues that it’s a passion of theirs. There’s, there’s definitely an excitement for people.

Yeah, I mean, there’s not a ton of places where you can get free weed at work and a 401k match. So I think it’s definitely exciting for folks.

Anthony Codispoti (33:38)
⁓ So I could see that I wondered where you were going when you said people can be kind of their their whole selves, their true selves. And so I get that right. If you were working in a corporate job or wherever you were before and they and they you know, cannabis was, you know, strictly taboo, couldn’t talk about it, you know, what are people going to think? And now obviously, you’re in an environment where it’s a much different mindset. And so people feel like they can just be more relaxed, more who they are talk about

Will Brophy (33:44)
Yeah.

Anthony Codispoti (34:05)
what they do in their free time more openly, right?

Will Brophy (34:09)
Yeah, we oftentimes, especially towards the tail end of the week, when we get to the end of the meeting, I’ll ask folks, you know, what’s everybody smoking this weekend? And people go wide-eyed still because they’re not used to being able to have an honest answer to that in a work call. But it’s exciting to get to be, ⁓ yeah, really be who you are in the workplace.

Anthony Codispoti (34:31)
So talking about the growth and why, you this is an industry that’s blowing up, it’s expanding and people want to be part of that. What are you particularly excited about ⁓ as it pertains to Navis’s growth? Where are you guys headed?

Will Brophy (34:48)
Yeah, we want to help lay the railroad tracks for the industry. So we’re excited to grow across the country. I’m particularly excited about growth in New York right now, where we already are. ⁓ Obviously California and Nevada are critical. ⁓ We’re never going to take our eye off the ball there. But very excited to see New York develop into a more mature market. There’s tons of signs. ⁓

that point towards it being an incredible market and it’s already great in many ways, but it’s gonna take time to fully develop and we’re hoping to help shape it into not just a big market, but a thriving market. And then there’s some other states across the country that we’re excited to expand into over time. And as always, we’re always eager to expand our platform in the states we are in to cover more of the needs of our brands and retail partners.

Anthony Codispoti (35:42)
say more about that last part. What does it look like to expand your platform? Are you just saying adding more products and more brands or is it adding more services to those clients?

Will Brophy (35:52)
Yes, all of the above. ⁓ Well put. I think for our retailers, ⁓ there’s some products and services we can add that’ll make their lives easier, but a lot of it is just expanding our assortment of brands and SKUs. And then for our brand partners, there’s always more we can do to set them up for success. ⁓ It’s really, really hard to run a cannabis brand. ⁓ there’s, you know…

It’s just complex and they have limited resources. So the more we can do to set them up for success, whether it’s through analytics, capital services, or entire new offerings that we don’t have now, I think the more we can set them up for success and support them, the better and the stickier our platform becomes.

Anthony Codispoti (36:37)
Any of those newer services that you’re working on now that you want to talk about?

Will Brophy (36:43)
Nothing, nothing that I want to sort of roll out just yet, but there’s plenty of exciting stuff coming down the pipe and we are working hard, especially on our sales and analytics is a big one. We’re definitely trying to make sure that brands and their sales teams in particular have access to all of the insights they need to drive growth. And I think, you know, this industry, for example, ⁓ still relies pretty heavily at times on

on a sales rep calling a buyer from a retail shop. And even if it’s an order they’ve placed every month for the last 24 months, it’s still very manual. then that ⁓ retailer has to set up or the brand rep has to take the order and set it up on our platform. And it’s a little bit manual and arduous. So, sort of indicators of when it’s time to reorder and waste. ⁓

reorder more effectively are really exciting for us. ⁓ We’ve got some partners that we’re working ⁓ on some solutions with, one of them called Virtually Managed Inventory, where there’s a little bit more ⁓ give and take between us and the retailer on what they need. in a dream world, you can set up PARs on our site where you say, as a retailer, we’ll share our inventory levels with you, the distributor, and if levels ever get below a certain threshold.

a reorder will be placed automatically. That would reduce the burden on everybody, the retailer, those sales reps. It’s common in other industries. mean, it exists in the liquor industry. So we want to drive the industry towards adopting some of those best practices so that we can make it a little bit easier to be a brand, a little bit easier to be a retailer in cannabis, because there’s already a lot stacked against them.

Anthony Codispoti (38:36)
Do you have anyone on your team that has experience working in the liquor industry that ⁓ you guys are able to kind of pull from some examples of what they’re doing?

Will Brophy (38:46)
Yeah, definitely. So, ⁓ you know, at the top, our president, Sean Arroyo, ⁓ worked in the liquor industry. He started a beer company and then worked with large distributors. And then we’ve got a few different folks, especially on our revenue side that have experience in alcohol. And then we have some awesome advisors from the alcohol industry as well. ⁓ you know, we’re we try to pick lessons from wherever we

⁓ and there’s definitely stuff to learn from the alcohol industry as well as, you know, big tech as well as, ⁓ other areas. yeah, we try to draw on, ⁓ as much expertise as we can, ⁓ because there’s, there’s not necessarily a roadmap for cannabis companies. There’s not a huge cannabis distributor that we can look to and model our business after we’re really sort of. You know, blazing that path. And, so it’s just really important for us to try to learn from other industries so we don’t end up.

know, falling down the same ⁓ path.

Anthony Codispoti (39:49)
As we’re talking about the future growth, you mentioned, you you’re in the three states now, you’re, you know, excited about growing all of them, ⁓ moving into new states at some point, any states that you have your eye on that you want to give voice to yet?

Will Brophy (40:04)
None that we’ve circled yet. There’s a ton of states that are really interesting to us. So yeah, nothing that we want to roll out yet, but I think maybe the criteria that we think about would be interesting. There’s a couple different ways that we would think about new states. So the first would be sort of geographical and demographic needs. So we definitely look at states that have difficult

geographies for brands to navigate because it indicates to us that there’s a large demand. So if you look at places, for example, that have large urban populations that are spread out from each other, you’re going to have a distribution problem. you know, that’s at the core of why we were successful in California, aside from the other good things we did. But, you know, one of the main problems in California is that your two major markets, the San Francisco Bay Area and Los Angeles area,

they’re five hours apart at least, right? And so if you’re running a brand, managing inventory across two cities makes it really tough, not to mention San Diego, Sacramento, all the many others, but there’s a distribution problem there. So it’s ripe for us to go in and help provide solutions. Whereas, you know, I have absolutely nothing against it, but we’re gonna add less value in a place like Rhode Island where any brand can self deliver their own products effectively.

So there’s those states out there that are really ⁓ geographically appealing, ⁓ some of them online, like the Ohio’s of the world, some of them not yet. mean, Texas is gonna be a whale for the distribution industry. think winning Texas will be huge when it comes online. Same with Florida. And those are inherently good distribution states because there’s a challenging geographical problem.

Another layer we look at besides sort of regulatory friendliness, which is a big piece, ⁓ is the more a market is segmented, the better it is for NavVis. ⁓ We do a really good job of helping segmented markets. If there’s one or two players only, it’s a little less exciting for us. There’s a sort of second vector we look at, which is where our existing partners want to be. And that might lead to a different direction, right? So while Rhode Island is not

Challenging from a distribution perspective traditionally. We also have you know 400 partners We really value and if 20 of them say we desperately want to be in Rhode Island But we don’t want to go do it ourselves We’ll consider that too because we want to support the partners we have in their expansion So really everything’s on the table But for somewhat different reasons and you know It’s up to us to figure out how to build our business in a way that reflects the needs in those various states

Anthony Codispoti (42:51)
You mentioned two states in particular, Florida and Texas, and they haven’t come online yet, meaning it’s not legal there yet.

Will Brophy (42:54)
No,

that’s right. So we won’t go there, obviously. But there are examples of, if you look geographically, know, Texas and California are in a league of their own when it comes to how many cities over 150,000 people you have and how far apart they are. Most states have one or two cities over 150,000 people. ⁓ You know, some of the larger states like the New Yorks of the world have four or five. ⁓

California and Texas have like, you know, 12 to 20 and they’re pretty far apart. So, I mean, they’re, really tough. Texas in particular with Houston, San Antonio, Dallas, Austin, ⁓ there’s just so many different major Metro areas that are far apart where you can’t essentially just plop down one warehouse in the middle of the state and service it all effectively with daily routes. That’s a, that’s a big sign that they need distribution support.

Anthony Codispoti (43:54)
What do you think has been the?

most effective growth strategy for you guys.

Will Brophy (44:04)
Yeah, I think in the simplest sense, it’s partner first expansion. So it’s really listening to what the people in the state need. ⁓ We are not a standalone brand that can just impose its will on a market, right? We really need to have an appetite for a distributor in a market to be successful there. And I think one of the things that we’ve done pretty well is balancing, you know, sort of

calls for us, need for us with an internal self-confidence, right? Where you have to believe that the market needs a distributor and you have to identify that a distributor would be effective there. And then you have to be confident in your own ability to go in and execute. sometimes there’s a need for a distributor and folks don’t necessarily think any distribution partner can handle it.

We’re less worried about the latter. We know how to execute effectively, but if we’re going into a state where there’s no demand for us, we’re not going to be as effective. So I think really listening is quite helpful. ⁓ And then I think being thoughtful about how we balance the long-term and the short-term is definitely key for us. We’re in a position now where we’ve got a little bit of a base to our business. ⁓ So we can think about, you know, what are we doing over a two, three, four, five year time horizon? Whereas,

you know, new companies starting up really have to prioritize the next 18 months. So I think it’s been pretty critical to our growth to get to a point where we can start to have slightly longer term thinking, which is typically very difficult in cannabis to do. So in New York, for example, we were able to go in and try to provide services to brands knowing that frankly, the market over the first 12 months was not a great market, right? It wasn’t.

Ideal for us, we didn’t make a ton of profit in it, but we knew we could build out a team and we knew we could build out a suite of products where we would start to get our hooks into the industry in a good way and really help people solve problems. And we believe that if we helped get the industry up and running in those first 12 months, it would pay dividends down the line. And that’s proven successful. So being sort of longer term thinking and going places where

we’re actually needed has been most effective. And so the final one I would say is going deep in states, right? So you’ll see a lot of people in cannabis that are a lot of companies in cannabis that are in 15 states, but they’re just working with partners in every state. They really have no sort of meaningful infrastructure or team in any of those places. And sometimes it works, particularly if you’re a brand that has amazing branding and you’re trying to be asset light.

Good strategy. ⁓ For a distributor, we have to provide depth of value in the supply chain for us to be worthwhile. So we really go into a state and we try to do it the right way and focus a little less on what I call corporate cookie licking and a little bit more on building sort of deep supply chain values so that our partners know that they can count on those NAVA services in those states.

That requires a sort of discipline of expansion that I think is hard for a lot of companies in cannabis. I mean, the fact that we’re only in three states tells you that we’re really committed to doing those states right. And we took a long time to expand out of California while a lot of our peers were going and grabbing the Missouris and the, you know, Oregon and other things like that. But we didn’t want to go places where we couldn’t build services that we really believed in. So I think that discipline has also been.

helpful for us.

Anthony Codispoti (47:50)
Sorry, you just shared a lot of interesting ⁓ information there and I appreciate it, but the thing that jumped out at me was a phrase that you used, corporate cookie licking.

Will Brophy (48:00)
Yeah, it’s the idea of like, you know, running state to state to plant a flag for the sake of planting the flag. ⁓ And I think, you know, I call it corporate cookie licking because it feels like people at times race into these new states to be the first in the ground with the understanding that at some point they’ll come back around and really build it out. But it doesn’t often happen and you end up stranding a lot of assets. So for us, the idea is like, you know,

until you’re ready to actually go after that state and do it the right way, it’s not as helpful to go plant a flag there to mix metaphors.

Anthony Codispoti (48:36)
Yeah, there’s not necessarily a first movers advantage if you’re not going to do it correctly and really commit the resources to it.

Will Brophy (48:43)
Yeah, there’s a first movers disadvantage there where, you know, our reputation is everything in the industry, especially it’s a small industry still. And if you, if you do, do, do people dirty in a state, they won’t forget it. And so we really only want to go in when we can build something and operate effectively. At end of the day, people are entrusting us with their product and they’re trusting us to be an embedded part of their supply chain. And we have to hold up to the standards of all of our

our partners. So if we’re not able and ready to do that, we have to take our time and get there before we ask for people’s trust in those new states.

Anthony Codispoti (49:22)
Will, I’d like to shift gears for a moment and I want to ask you about a serious challenge that you’ve overcome in your life, whether it’s personal or professional. How did you get through that? What did you learn?

Will Brophy (49:34)
Sure. So about four, five years ago, ⁓ we had a 420 from hell at NavVis. For those who don’t know, 420 is a pretty big holiday in the cannabis industry with lots of consumption and the industry does a ton of ordering ahead of it. So it’s really, it’s peak volume season for us. Think of it like what…

Prime Day probably feels like an Amazon where you’ve got 3X, 4X the volume flowing through your warehouse. And one of the important things to note for us is that we’re exclusive distributors for quite a few of our brands. So if they want to get product out, it’s coming out of our doors, which is a ⁓ vote of trust from them. But it also means that if our system gets backed up and we’re not getting orders out, we are directly impacting the revenue of our partners, which is super serious.

So we had a situation where essentially, know, our warehouse was starting to get overloaded with product and we weren’t quite ready for the volume surge and we had large delays, misspacks. We did our best and honestly still did just about as well as anyone in the industry, but we expect to be better and we had delays, which we almost never have at NavVis. We deliver…

over 97 % of orders on time and in full. And we’ve trained our partners to expect that. I believe they should expect that and demand that of their partners. And we struggled to get there. I mean, we did our best and we did pretty well, but not to the standard we would expect. And it was pretty devastating for a lot of us because we were getting the calls from our partners saying, hey, we’re not happy. Some didn’t mind, they were really understanding, but others were pretty gutted.

That was a big wake up call that we have to be really careful about capacity management. There’s quite a few lessons we took from it. I think one of the things we do well at NavVis is we try to look really hard in the mirror and, you know, sure we’ll pat ourselves on the back when things go well, but we also need to be really honest with ourselves when things don’t go well. And we weren’t proud of that moment. So we did a lot. I mean, I learned a lot from like a personal leadership perspective on what I need to do to be an effective leader at NavVis. And then

As an organization, we learned a lot about how careful we have to be about capacity planning and how rigorous our processes need to be to really flex under the weight of massive, massive volume. And we spent the last four years getting better and better and better. So hopefully that situation never repeats. And I think we’ve earned back the trust of all the partners from that. I think we earned it back pretty quickly. ⁓ But yeah, it wasn’t our finest moment, though looking back.

I’m really glad that it sort of, it sounds crazy, but glad it blew up in our face big and early so that we could learn some really important lessons early on about what happens if you don’t build a system that’s ready for the weight of future scale. And we’re really, really conscious about, you know, making sure we don’t overload our system anymore. ⁓ And we built in both tech features that help smooth.

⁓ volume ⁓ and then we built a ton of internal processes to make sure that we’re just hyper aware of how we’re filling up our space and how much human capacity we have to get orders out the door. Because at the end of the day, yeah, we take that, ⁓ we take the trust that brands give us really seriously. So anytime we violate that, it’s gotta be a huge wake up call for us.

Anthony Codispoti (53:10)
So what was the core problem when this occurred? Is it you guys didn’t think that the orders were gonna be the volume that they were, you didn’t have enough people on hand, you didn’t have enough boxes to fill the orders, just not a large enough warehouse space, some combination of all of that?

Will Brophy (53:30)
Yeah, it’s never one thing. It’s always a confluence of factors. I think the big ones were we didn’t realize just how much the volume would surge, especially in those COVID years. We weren’t really sure what 420 was going to look like. And I think we got caught a little flat-footed. Most of the problem was centered around us. We were basically filling up one of our facilities in LA and it was

it was over full and we needed to move to a new facility and the timing wasn’t great relative to 420. And, ⁓ you know, one of the tough things about inventory is there’s a little bit of a, it’s a little bit binary, right? Where you either know where every single unit is or you don’t and it can start to spiral. We definitely didn’t know where every single unit was because we had both an over full building and we’d moved to a new one. ⁓

We, one of our big lessons was never to do a warehouse move, never to let it get too full and never to do a warehouse move close to our peak seasons. but that definitely made it hard. And then, yeah, I mean, it’s, it’s really like a gran of sand and the motherboard type thing where our systems, ⁓ we had redundancy in place, but they weren’t entirely ready for the comorbidity of operational problems. So for example, we had ways for our drivers to flex in and help our warehouse staff, but

when it happens at peak season, those drivers are fully occupied on the road. So it was hard to sort of bail out. So we got our whole staff in. mean, we had our full executive team in the warehouse packing orders and we found a release valve, but yeah, was a bunch of different problems and it took a bunch of different solutions to get out of it. So not one thing and yeah, but we’d learned a ton from it. And I would argue now we’re in a position where ⁓ we’re more prepared for buying.

I anyone in the industry because we’ve learned the hard lesson.

Anthony Codispoti (55:26)
Yeah, and I understand what you’re saying. You almost look back at it’s strange to look back at that moment with a sense of gratitude because it you know, it was really painful to go through but it exposed all of these cracks in the foundation at the same time. And so you guys got busy in a hurry fixing those cracks, which is just set you up for better growth as you move forward.

Will Brophy (55:50)
Yeah, yeah, and I think that we learned, we learned the lessons the hard way for sure.

still had some grace and letting us figure it out. I think the expectations are different for us today and that’s something we try to own. yeah, blessing in disguise, not something we ever want to replicate. And it wasn’t, we did our best to get out of it. It wasn’t, I wouldn’t say fully catastrophic, but definitely a huge learning lesson for us, for me personally and for the company as well.

And yeah, I mean, think it’s just important for us to own when we’re not perfect so that we can get better and strive towards it.

Anthony Codispoti (56:30)
that’s so important, you know, because I think in any business relationship, things are going to go wrong at some point, right? And it’s how you step up and handle that, that I think really defines you as a company.

Will Brophy (56:41)
Yeah, a hundred percent. Um, especially, you know, we’re part of other companies as well. It’s not just us. We can’t just, uh, we can’t just, you know, focus on ourselves. Really the, the part that stung wasn’t that we were having long days or doing anything that was, that was hard. The part that stung was the calls from, from clients saying, you let us down here. And we vowed to not repeat that ever again.

Anthony Codispoti (57:07)
Nice. What’s your superpower, Will?

Will Brophy (57:11)
Yeah, I don’t know. That’s a hard question. I think if I had to say my superpower would probably be, you know, building great teams to solve hard problems. So I really enjoy taking a step back and identifying the right mix of skills and perspectives, and then setting up a team of people for success. My role is often about creating clarity and cutting through noise and aligning everybody on

and making sure the team has the autonomy, the support and the vision to execute. And I think that’s where I’ve had the biggest impact at NavVis. ⁓ know, earlier in my career, my answer might’ve been something about my own individual talents. I no longer really think that’s the area where I have the largest impact. It’s more about, you know, telling a story of where we’re trying to go.

and then finding the most talented people we can and explaining to them what their part of their story is and setting them up for success. And then to the extent they have blockers along the way, helping them take down those blockers. you know, I think we have a team at NavIS that I would stack up against anywhere. And when I think of what I’m most proud of at NavIS, it’s helping to assemble that team of people to tackle super hard problems. So I guess I would call that my superpower.

Anthony Codispoti (58:36)
How do you, what have you found success with when it comes to recruiting and retaining folks, whether it be kind of your leadership team or more of the frontline workers, because you guys are growing fast. How do you approach that?

Will Brophy (58:48)
Yeah, it’s an evolving question. As we change over time, we have to change our approach. And I think, you know, if there’s one answer that’s always true, it’s probably not a very good answer because what worked for us at 40 people, it’s different from what works for us at 500. I think there’s definitely through lines though. We have to stress the culture and stress the mission and people want to be part of an industry defining moment.

practical habits like structured onboarding really, really help. ⁓ And they help scale culture even, but ⁓ a lot of it is finding people that are there for the right reasons. I tend to think ⁓ if I were to sort of drill down a little bit, especially on my team as I hire, I tend to look for people who have a really strong intelligence to ego ratio. ⁓ I find that that predicts really well into the cannabis industry that’s endlessly challenging and requires

a lot of ⁓ compromised collaboration and adaptation. If you find people that are really smart and don’t take themselves too seriously, I like to say it, know, people who take their work super seriously, but don’t take themselves too seriously are really quite effective at NavBus. And, ⁓ you know, we’re, not a perfect workplace for everyone, but for self-starters who want to, you know, really launch their careers and drive big, big, ⁓

initiatives, it’s an awesome place to work. So we try to, we try to find the right fit for us and then we end up being a good company for them too.

Anthony Codispoti (1:00:22)
Will, what’s something that you wish more people understood about your industry?

Will Brophy (1:00:28)
I think I wish people understood how challenging it really is. think ⁓ there’s a perception that the cannabis industry is a really chill industry full of people who just sort of hang out and smoke pot. I think, ⁓ you know, there’s, definitely a fun industry to be in, but it’s some of the hardest working people I’ve ever had the chance to interact with and people who are taking big bets on themselves. ⁓ You know, folks starting small businesses.

folks starting large businesses. ⁓ It’s really hard and there’s really, really tough moments and really, really great people working on hard problems. So I think ⁓ I like to disavow people that it’s an easy chill industry more than anything so that folks know what they’re walking into if they’re interested in the industry. ⁓ But I think it’s also important to highlight the need for… ⁓

better regulation, like we need access to normal banking and it affects everybody. So definitely, yeah, a little bit of a call to action there that the more we can normalize cannabis and pressure our local politicians to care about cannabis, it creates jobs, it creates tax revenue and there’s really positive benefits from it. you know, I think a lot of people stop short at, know, cannabis is everywhere and therefore it’s normalized or sort of missing that it’s,

very popular, but it’s not normalized at your bank. It’s not normalized with your politicians. So the fight’s not over yet. And I think it’s important for people to realize that.

Anthony Codispoti (1:02:05)
I’ve just got one more question for you, Will. But before I ask it, want to do two things. First, everyone listening, pause for just a second, open up that podcast app that you’re using right now and hit the follow or subscribe button. That is going to allow you to get more great content like we’ve had today with Will Brophy from Nabis. I also am going to tell you folks the best ways to get in touch with Will and ⁓ his company. So for Will himself, you can

Will Brophy (1:02:10)
Sure.

Anthony Codispoti (1:02:32)
reach out on LinkedIn. His name is Will Brophy, B-R-O-P-H-Y, Nabis is N-A-B-I-S. And if you want to get in touch with the company, their website is nabis.com, N-A-B-I-S.com, where you can reach out to ⁓ via email, partnerships at nabis.com. And that’s specifically for folks that are looking to do what with you,

Will Brophy (1:02:55)
Yeah, retailers or brands that are looking to partner with us, particularly brands interested in getting on our platform, but really anyone that’s, you know, keen to work with us, feel free to reach out.

Anthony Codispoti (1:03:06)
Great. The last question for you, Will, a year from now, you and I reconnect and you are super excited because you’re celebrating something big. What’s that big thing you’re celebrating one year from today?

Will Brophy (1:03:17)
Hmm, that’s a good question. ⁓ My hope is that we’re celebrating a pretty massive proliferation of the number of retailers in New York and the size of the business. ⁓ I think it could also be exciting for us to be in new states, but ⁓ you know, most excited about doubling the size of the New York market over the next year. I think it’s possible, certainly not guaranteed, but

there’s still a tremendous amount of untapped potential in the New York market. So excited to see that continue to grow.

Anthony Codispoti (1:03:52)
Excellent. Well, Will Brophy from Nabas, I’m to be the first to thank you for sharing both your time and your story with us today. I really appreciate it.

Will Brophy (1:04:00)
Yeah, thanks for having me. Pleasure to talk to you, Anthony.

Anthony Codispoti (1:04:03)
Folks, that’s a wrap on another episode of the Inspired Stories podcast. Thanks for learning with us today.