5.5 quick questions about breaking through as a mom-and-pop cannabis company with Kristi Palmer
Kiva Confections has come a long way.
From its start making chocolates in a San Francisco kitchen during the California medical days of 2010, Kiva’s infused edibles are now available in nine states and the company has grown to almost 400 employees, with multiple brands, flavors and product forms, including gummies, mints and fruit chews.
According to co-founder Kristi Palmer, it’s Kiva’s dedication to quality ingredients and its focus on constantly innovating that has helped propel the once-tiny company to success on a national level.
“The reason that people are really attracted to Kiva is we’re always coming out with cool new stuff,” says Palmer. “We love to create, we love to create different flavors, different product types. And we keep things really fresh and interesting.”
Marijuana Venture recently had an opportunity to ask Palmer about the company’s success and what it takes for small companies like hers to break through in a marketplace often dominated by well-capitalized competition, as well as one tangent into a unique product form.
Marijuana Venture: What were some of the difficulties you faced as a small mom-and-pop company?
Kristi Palmer: When we started, there were no professional products in the market. There were hardly any other professional companies, period. There were no regulations or laws for cannabis, no tax, no recreational; everybody had to be seen by a doctor in order to be given a recommendation for cannabis. So it was a completely different market. But because of that, there was a ton of opportunity to sort of get started, wherever you wanted, in any type of vertical that you wanted to, but there was certainly no playbook. That was something that we kind of yearned for in those early days. So we had to design those as we went along. And that ended up culminating in labeling standards that we set for ourselves, testing standards, screening for pesticides, for example, in our starting material in our THC extracts.
So where there wasn’t regulation, we began to act as if there was and that was to ingratiate ourselves to consumers, and to win their trust, and to create a long-lasting brand. It was “let’s redefine what edibles can be, let’s build trust amongst the consumers and professionalize the industry and the edibles market” and that’s what we’ve continued to do.
MV: What were the keys for Kiva to break into the larger market and industry?
KP: So back in the day there was just so little professionalism in the market, that simply coming to dispensaries with a product that was tested, labeled, packaged professionally and presented well was huge. And also delivered to the store within the timeframe that you gave them. Those foundational or basic principles really helped us. In the beginning it was all about consistency — consistency in your product, consistency of when you show up, good communication — pretty much the principles that you find in the regular, non-cannabis world just applied to cannabis went a really long way with our customers, giving us a positive reputation.
Today, it’s totally different. All of that does go very far, but you really have to innovate like crazy today with your product line, to continue to stay fresh in the consumer’s mind and to stay relevant. We’re constantly innovating, coming out with new products, new formats, new flavors, anything that we can do to stay fresh and keep the consumer engaged. Those are really huge. In order for a brand to expand, you can’t just show up with those foundational basics. We really have to go out there and capture the market share we want.
MV: How do you break through in a new market, then? What’s the key for a small business from California to break through in, say, Illinois?
KP: What we have found to work best for our brand is to support the retailers and communicate with not only the retail team, but also the consumer. So we do a lot of in-store activations. We put boots on the ground in the store, and one-on-one they are talking with each consumer that comes in. We also spend time to educate the budtenders at those stores: help get them samples so they can experience the product, tell them how their brand got started and what are the unique attributes of each of the products in our lineup, so that they can present the company and the products to the consumers that are looking for them.
MV: What innovations has Kiva made to stay at the forefront of consumers’ minds?
KP: One of our new product lines is Last Farm, and we launched that California two or three years ago. And it stands out because it’s strain-specific, live resin gummies and fruit chews. We use unique strains or trending strains and some of your old classic favorites too, and then we make some flavors so that the two sort of play off of each other. But it’s a bit of a connoisseur product, 10 milligrams (THC), and it really heightens or celebrates the unique characteristics and flavors of the cannabis strain that it includes. We took that product to Illinois, and it sold out essentially overnight. It was like a week that we had it in the market, and it was completely allocated, and completely sold out, far exceeding our expectations.
It’s just really cool to see when you’ve hit the mark with a product. You’re paying attention to what consumers want, you’re listening to trends, and then you create a product that fits together with the consumer like a puzzle piece. It’s super exciting.
MV: Now, correct me if I’m wrong here, but I heard that Kiva also made a gravy product? Is that right?
KP: (Laughs) It was launched initially as something fun to bring attention around the holidays. You know, you go to Thanksgiving, and you’ve got your weird uncle on a tirade and it can be awkward sitting around the table with people you only see once a year. So what better than some cannabis gravy to pour over the turkey and liven up the conversation, loosen people up and really start a conversation around the normalization of cannabis as well? So that was kind of the beginning of the gravy. We launched it in 2018 and then we brought it back again last year, 2022. And it just did everything that we ever hoped it would. It started so many conversations and got tons of media and press. It was mentioned on the Colbert show, all kinds of really cool publications and broadcast. So yeah, the gravy was just a really fun product overall.
MV: What is your advice to other small businesses looking to break through? What can they learn from Kiva’s story?
KP: I’m going to give advice for small businesses and I’m also going to give advice to the folks that make the regulations in cannabis laws. I’ll start with the regulators. The rules right now in most states make it very, very hard for companies and brands to get started. It’s just extremely expensive. You can’t start a business in your home kitchen anymore, certainly not in California. And the cost to operate, the cost to be compliant is really astronomical. And I think it ends up hurting small businesses and hurting equity players as well as they’re just unable to get started in the industry that has so much promise and so much potential.
For small businesses, I would say if you’re going to jump into cannabis, find what you’re awesome at and do your best to stay in your lane. The cannabis industry is full of shiny objects. People are constantly expanding and going into new markets or new verticals, new lines of business that can ultimately be a bit distracting. I think it’s important to find what you’re good at and stay there. Do it really, really well. And then once you figure it out, it is second nature, then you can begin to expand.
This interview has been edited for length and clarity.